Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to the newest version of your browser.

Your browser appears to have cookies disabled. For the best experience of Construction News, please enable cookies in your browser.

Welcome to the Construction News site. As we have relaunched, you will have to sign in once now and agree for us to use cookies, so you won't need to log in each time you visit our site.
Learn more

Bank of England cuts interest rates to 0.5pc

The Bank of England today cut interest rates from 1 per cent to 0.5 per cent.

Charles Stanley chief economist Edward Menashy said it is likely to be the last reduction in interest rates of the current cycle by the Monetary Policy Committee.

There has been a dramatic decline from the peak of when base rates were last raised to 5.75 per cent on 5 July 2007 down to the current level of only 0.5 per cent.

Mr Menashy said: “The MPC has for some time been giving signals that it will use unconventional methods of easing credit.

“Having sharply revised downwards its GDP and inflation estimates, and with reduced interest rates proving ineffective, the MPC has decided to go down the path of quantitative easing.”

“Given the reconstruction already undertaken in the banking sector regarding recapitalisation, the ring-fencing of toxic assets and the insuring of other debt, this combined with quantitative easing should give the UK an excellent chance of overcoming the credit crunch.

“The last chain in the jigsaw remains; will the consumer want to borrow.”