For savers in particular, another rate cut is the last thing they wanted. With the average easy access account now paying 0.9% and nearly 200 accounts paying 0.25% or less, millions of people who rely on savings interest for income are really struggling.
The extent to which they are being affected by the interest rate cuts - Bank rate has plummeted from 5% since October - has really come to the fore recently. We interviewed Yvette Cooper, Chief Secretary to the Treasury, last week and more than 700 questions were submitted, the majority from angry savers wanting the Government to do something to help them.
Cooper suggested that there would be something for savers in the Budget next month but in the meantime life will continue to be tough and the rates on many accounts will fall further in the coming weeks as banks and building societies respond to the latest rate cut.
But even borrowers, who should be the main beneficiaries of falling interest rates, may not see much impact from today's half-point reduction.
Most of those with tracker mortgages, which are directly linked to Bank rate, will see their monthly payments fall - many will now be paying less than 1% interest on their home loans.
However, millions with variable rate mortgages linked to their lender's standard variable rate (SVR) will be left disappointed. An increasing number of lenders are expected not to pass on this rate cut on in full.
HSBC and Abbey are among the lenders that left their SVR unchanged following February's half-point cut and many others including Alliance & Leicester, Royal Bank of Scotland and Northern Rock failed to pass on the full reduction last month. In fact, Lloyds TSB/Cheltenham & Gloucester is the only major provider to have passed all the recent rate cuts on and it has already pledged that its borrowers will benefit in full from today's reduction as well.
For more information on how the 20 largest residential mortgage providers have responded to falling interest rates read our article 'How has your lender responded to the rate cuts?'.
And let's not forget the five million or so households with fixed rate mortgages who have not seen any benefit from the recent rate cuts, then there are all of those in rented accommodation - their landlord's mortgage payments may have fallen but this isn't passed on to tenants in the form of rent reductions.
Therefore all in all, there will be more net losers from today's rate cut, than there are winners. So what should you do?
Savers
The message for savers can't be emphasised strongly enough: check the rate on your savings accounts and move your money if necessary.
There has been a bit of good news for savers in recent weeks, because a number of new deals have been launched paying more competitive rates.
If you've not used your Isa allowance yet this tax-year, you can invest up to £3,600 in a cash Isa before April 5 and your interest will be tax-free. The leading accounts are paying 3% or more. For more information about cash Isas, watch our video 'Cash Isas explained'.
If you have already used your Isa allowance or have additional money you are seeking a home for, the highest rates are available on fixed rate bonds. ICICI Bank is paying 4.10% on its two-year fixed rate HiSave account. If you don't want to lock your money away for two years, ICICI has a one-year bond at 3.90%.
If you'd prefer an easy access account, you can still get a rate around 3% - Egg's savings account is paying 3.35%. However, bear in mind that these are variable rate deals so the rates are likely to fall in the coming weeks.
You can find more information on the latest savings rates on our savings channel.
Borrowers
If you're coming to the end of your current mortgage deal or are already paying your lender's SVR then it's worth looking into whether or not you could benefit by remortgaging. Although we haven't seen mortgage rates fall in line with the base rate reductions of recent months, they are edging lower. First Direct for example, launched a two year fixed rate offset this week at 2.99%.
However, the leading deals are only available to those with sizeable deposits so even if your lender doesn't pass on the rate cut in full, you may be better off sticking with your current provider for the time being even if it does mean paying its SVR.
If you are unsure about what is the best option for you, visit our mortgage channel and speak to an independent mortgage broker.
Disclaimer: Please note that any rates or deals mentioned in this article were available at the time of writing.
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