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Interest Rate .5% cut
- Thread starter REDLAND
- Start date
Tricky Dicky
New member
Depends if you are a borrower or saver, and if a borrower, if they pass on the cuts.
Cutting interest rates in a crisis is like pushing on a string.
On a tracket rate so good news for me
Is that true though? It should increase consumer spending and hopefully imcrease confidence.
And 0.5 is a fairly massive cut isn't it.
Not if you are a saver dependent on interest payments. And for the rest of us, only if mortgage rates fall... and even then people have increased bills to pay, so I can't see much of it reaching the high street.
But why wouldn't mortgage rates fall if the BoE base rate has fallen?
Because lenders aren't under any obligations to mirror it (except for trackers of course), and they have become more reliant on the LIBOR rate (the rate banks lend to each other) to determine the mortgage rates they offer customers. The divergence between the BoE base rate and the LIBOR rate has been one of the fundamnetal issues in mortgage over the past year.
Tracker rates will fall, but can you really see the cash-starved banks giving money away right now by reducing variable rates for existing borrowers??
I realise they're under no obligations to mirror a BoE rate cut but such a cut is nearly always partially passed on to the consumer.
And surely LIBOR is partly influenced by the BoE base rate anyway? But in any case I'm not sure why our banks are any more reliant on LIBOR than EURIBOR or any other inter bank lending rate, given the global market they operate in.
And surely LIBOR is partly influenced by the BoE base rate anyway? But in any case I'm not sure why our banks are any more reliant on LIBOR than EURIBOR or any other inter bank lending rate, given the global market they operate in.
Tracker rates wil fall 0.5% now, SVR rates will fall 0.3% ish from next month I would say.
But how much of the cut?
BS rates have been fluctuating for months, while the BoE rate has been constant.
Mortgage rates cut on Bank news
Mortgage costs have been fluctuating in recent months
Mortgage providers have been dropping the cost of their home loans following the emergency cut in UK interest rates.
Halifax said it will be reducing its standard variable rate (SVR) from 7% to 6.5% from 1 November.
Lloyds TSB, which also lends under the Cheltenham & Gloucester brand, said it would cut its SVR by half a percentage point to 6.5% on the same date.
Mortgage costs have been fluctuating in recent months
Mortgage providers have been dropping the cost of their home loans following the emergency cut in UK interest rates.
Halifax said it will be reducing its standard variable rate (SVR) from 7% to 6.5% from 1 November.
Lloyds TSB, which also lends under the Cheltenham & Gloucester brand, said it would cut its SVR by half a percentage point to 6.5% on the same date.
unlikely inflation could plummet to 1% next year as the recession bites
Gully
Monkey in a seagull suit.
Surely the pressure will be on for interest rates to be cut, the banks/lenders won't be popular if they don't pass the majority of it on, isn't the idea to gee the economy up again?
Juan Albion
Chicken Sniffer 3rd Class
I would have said they had been consistently high. Especially on here.