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Time for a big cut in rates (Updated 1.5%)

After a timid cut last month, when the MPC should have cut interest rates then by at least a whole percent, now they have to be bold. If they don’t and bottle it again then the recession is going to be drawn out and very bumpy indeed. The need to be cutting rates by at least 1 percent anything less will have zero impact.

The only way things will turn around more quickly is if interest rates come down quickly and the government adopts the LibDem plans to cut income tax by 4%, scrapping the unfair council tax and replace it with a fair local income tax based on the ability to pay.

Updated: Bank of England cuts by 1.5% (reduces rate by a third from 4.5% to 3%) to the lowest rates since 1955. More: http://news.bbc.co.uk/1/hi/business/7713006.stm
This is a dramatic cut and they should be applauded for being bold. The pressure will now be on the High Street banks to pass on all of the rate cut to their customers. This must be coupled with cuts in income tax and scrapping council tax so that hard pressed, hard working people feel more confident and have more cash in their pocket.