Rate cut predicted this month or next - commercial mortgages

07 January 2008

Interest rates have been tipped for a cut either this month or next, in news which may be of interest to those looking for commercial mortgages.

The Bank of England monetary policy committee (MPC) will meet this week to discuss the possibility of a further rate cut following last month''s reduction from 5.75 per cent to 5.5 per cent.

In its analysis of the prospects the Times said the most recent retail data may play a decisive role in the outcome of the MPC meeting this week.

The conclusion the paper reached was that the decision was of a "knife edge" nature, although it suspected the most likely outcome was a hold decision.

However, it added that there would probably be a cut by the spring.

Similarly, Global Insight economist Howard Archer said the decision would be very close, but "regardless" of the outcome this month there would be a cut no later than February''s meeting.