Rates held for third month in a row

In what was a widely-anticipated decision, the Bank of England has held interest rates at 5.75 per cent for October, with calls for a pre-2008 cut now set to grow stronger.

The Monetary Policy Committee (MPC) voted by a margin of 9-0 to keep rates at 5.75 per cent in both August and September, though the details of October's decision will not be known until later this month.

But with Halifax today reporting that house prices fell by 0.6 per cent in September, Global Insight analyst Howard Archer has said that the case for an imminent cut is now stronger.

"It now seems likely that the Bank of England's next move will be to trim interest rates, possibly even before the end of the year," Mr Archer commented.

"[The Halifax report] boosts the case for an early cut in interest rates," confirmed Mr Archer, UK and European economist at the firm.

The Centre for Economics and Business Research, meanwhile, has said that the Bank has now turned its attention from inflation to growth, a move which "would suggest a November rate cut".


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