New poll shows rate cut expected

A poll of economists has produced further evidence of an almost universal expectation that the Bank of England will cut interest rates by 0.25 per cent this week.

Bloomberg has revealed that its survey of 61 economists established that 58 believe the monetary policy committee (MPC) will announce a quarter-point cut on Thursday (February 7th).

Two economists forecast a 0.5 per cent reduction and one anticipated that rates would remain on hold at 5.5 per cent.

Such a move could reduce the cost of borrowing for those planning to buy land on which to build their own home.

Bank of America economist Matthew Sharratt told Bloomberg: "There is clearly a sense at the bank [of England] that rates are restrictive and need to come down."

Last week saw two polls of economists which were unanimous in expecting a 0.25 per cent trimming of the rate.

All 60 who spoke to Reuters plus the seven contacted by Adfero said the rate would be lowered to 5.25 per cent.


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