Economists unanimous about rate cut

An Adfero poll of economists has seen all seven experts quizzed tipping the Bank of England monetary policy committee to announce a reduction in the base rate from 5.5 per cent to 5.25 per cent on February 7th.

Of the seven, only Howard Archer, chief economist of Global Insight, suggested that the rate may fall further.

This might only happen if growth and equity indications deteriorated markedly by the time of the MPC meeting, he added.

A cut in the base rate may have a positive effect on the housing market by lowering borrowing costs, which in turn could lead to more house building as demand for property is rekindled.

The Adfero poll outcome was matched by a much larger poll of economists this week by Reuters.

All 60 of those who the news agency contacted forecast a 0.25 per cent cut.


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