Does todays news make it more likely that interest rates will be cut soon?
Yes, following today’s events it is likely that the Bank of England will reduce interest rates in the UK quicker than previously thought. It is thought the Bank could now slash the official cost of borrowing as early as October, although it remains more likely that it will wait until November. Many economists have previously expected the Monetary Policy Committee to hold off cutting rates until February next year, due to high inflation. Falling interest rates would be good news for homeowners with variable rate mortgages, providing lenders pass on the cuts.
