Interest rate cut predicted - buy to let mortgages

03 February 2009

Analysts have predicted that the Bank of England is due to make another interest rate cut when its monetary policy committee (MPC) meets this week.

In a poll conducted by Adfero, 11 out of 12 economists forecast that the MPC will trim the base rate on Thursday - something that could lower the cost of buy to let mortgages.

The majority of those questioned said they expected a cut of between 50 and 100 basis points to be made.

"Whilst the Bank still has room to cut it should do so," commented Mark Swift of business organisation EEF.

And Charles Davis from the centre for economics and business research said: "Everything seems to be supporting the downturn at the moment. That might well push them into even stronger action than a 50 basis point cut."

But Simon Rubinsohn of the Royal Institution of Chartered Surveyors predicted that the MPC would hold the rate, claiming that the committee will cut in March instead.

Following a reduction of 0.5 per cent in January, the base rate currently stands at 1.5 per cent.