MPC member in interest rate comments

Tim Besley, a member of the Bank of England's monetary policy committee (MPC), has said that the Bank will use other means than just interest rates to deal with the current economic problems.

Speaking in London, Mr Besley reiterated that when any interest rate reductions helped the wider economy that was incidental to the central objective that inflation should be kept as close as possible to the two per cent consumer prices index objective set by the government.

Mr Besley said examples of alternative measures included the £50 billion bond securitisation scheme introduced by the Bank yesterday to try to add liquidity to the mortgage market.

Such a sentiment may dash any hopes that the MPC will prioritise the rate of mortgages when it makes interest rate decisions, leaving these products costing more as a result.

Under such circumstances many may find it is more cost-effective to use the self build option to get a house.

Minutes of the latest MPC meeting, held earlier this month, will be published tomorrow.


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