Two early rate cuts predicts Rics

Posted: 21 Dec 2007 11:54:18 GMT

The Royal Institution of Chartered Surveyors (Rics) believes that the base rate of interest will be cut to five per cent early next year.

The Royal Institution of Chartered Surveyors (Rics) believes that the base rate of interest will be cut to five per cent early next year.

During an appearance on Channel Four's 'News at Noon', Rics' chief economist Simon Rubinsohn said that he expects two early-year rate cuts.

It follows the publication of the minutes from the Bank of England's Monetary Policy Committee (MPC) meeting, which revealed that all nine MPC members voted in favour of a December rate cut to 5.5 per cent.

"2008 isn't going to be the easiest of years for the housing market, but although there's a lot of negativity around – and it's easy to see why – actually there are some positive issues that one can focus on, which will ultimately we believe underpin the housing market," Mr Rubinsohn told the programme.

"In particular, we've seen the Bank of England cut interest rates recently. We believe that they will cut interest rates again at least once, if not twice, in the first few months of 2008," he continued.

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