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Rate decision divides analysts

Home Insurance News - Published: 04/04/2008
Rate decision divides analysts
Analysts remain divided ahead of next week's interest rate decision.

The Bank of England's monetary policy committee (MPC) makes its April announcement on Thursday but experts are split on which way it will fall.

House prices are stalling, the mortgage market is in crisis and the cost of living is rising meaning consumers will be desperate for a cut.

But inflation remains a concern, with the latest figures showing a small rise, meaning another cut following those in December and February could be put off for another month.

"It's a very close call," said Jeavon Lolay, senior economist at Lloyds TSB. "The data suggests that interest rates are likely to be cut in coming months. It’s just a close call between whether that’s done in April or May."

Six out of the eight analysts canvassed in a straw poll said they expected a cut this month, with two expecting the next move to come in May.

As well as rising fuel and food bills, people across Britain have seen their home insurance premiums rise as a result of last year's floods.ADNFCR-1058-ID-18537098-ADNFCR



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