The Bank of England (BoE) announced a further one percent cut in the base interest rate today, the rate now stands at the lowest level since 1951 at 2%. The statement from the BoE appears to leave the door open for further cuts if the financial crisis and recession do not respond to it’s latest move.
The rate seems of little consequence unless the government can encourage the banks to lend money to businesses and the public alike, so far the banks have paid lip service only to Gordon Browns futile attempt at enforcement.
Although the banks are happy to accept government help in the form of tax payers funding and exceptional guarantees on funds loaned, there seems to be little or no improvement in securing a loan on favourable terms with the high street outlets.
It is also debatable whether we feel comfortable in seeking out loans business or personal in the current financial situation where the immediate future appears so uncertain.
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