Interest rate decision "expected" but "benefits" for lenders and borrowers later in year

Posted: 06 Jun 2008 13:31:33 GMT


            Property News - Interest rate decision "expected" but "benefits" for lenders and borrowers later in year

Industry experts have commented on the decision by the Monetary Policy Committee (MPC) to hold interest rates at five per cent saying it was "expected".

Industry experts have commented on the decision by the Monetary Policy Committee (MPC) to hold interest rates at five per cent saying it was "expected".

The MPC gave the news yesterday (June 5th) and commentators were unanimous in their summation that they had forseen the outcome as the Bank of England struggles to manage rising inflation.

Michael Coogan, director general of the Council of Mortgage Lenders, commented: "We hope that as the effects of the Bank of England's liquidity scheme feed through the financial system there will be some benefits for mortgage lenders, and in turn borrowers, later in the year."

Barclays Stockbrokers and Abbey predicted further rate cuts in the latter part of the year, whilst independent mortgage adviser, John Carol, said it looks as if "we are headed towards a period of stagnant rates as the economy attempts to ride out the current problems".

Borrowers should, according to Drew Wotherspoon of John Charcol "act now" if they are looking to snap up a fixed-rate mortgage.

A number of lenders have hiked up prices on their fixed-rate deals and John Charcol say they expect others to follow this trend.

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