Brown to act over rate cuts

Posted: 14 Apr 2008 10:53:17 GMT

Recent cuts to the base rate of interest have not been passed on to borrowers and the prime minister has promised to do something about it.

Recent cuts to the base rate of interest have not been passed on to borrowers and the prime minister has promised to do something about it.

Although many lenders reduced their rates in April in line with the reduction to the base rate of interest, large numbers had already increased their mortgage rates prior to the announcement.

It is because the inter-bank rate remains high as the global credit crunch rolls on.

However, Gordon Brown has promised to take action, telling the News of the World that he wants to introduce "new measures to ensure those lower interest rates are passed on to mortgage holders".

"The Bank of England is injecting an additional £15 billion. We need to do more to see this feed through to improved availability of mortgage lending," he added.

The base rate of interest currently stands at five per cent after three reductions since December.

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