Well now we know it is another .5% cut - this is madness!!!

So many savers wondering why they bothered, many borrowers with mortgages not being given a reduction. Does anyone know just WHAT ther Bank of England expect to achieve by this? Are all these reductiuons just to give banks cheaper money to pay into pension funds for early retired fat cats?

Any answers?

Sylvia

The spenders are all spent out - they spend by borrowing which helped get us here. Now their collective memories aren't brilliant but even they will now understand that even if they could borrow at rates similar to the BoE rate they'd get caught when the rates go up again as they will. The BoE's constant rate cutting really is futile since the banks are not passing on the rate cuts, they maybe worried about borrowing, but at the moment they can't believe the margins they're being given by the government. BoE rate 0.5% - their rate - 5% (if you're very lucky) to 27%(and beyond via plastic) - wow! I doubt we'll even benefit from corporation tax takes at the end of this year as the banks try to avoid paying it and they'll be believed when they scowl and revalue their assets down to reduce their liability anyway and the government will believe them! Then the Government print loads more money - which dilutes the value of the "pool" i.e. your cash - as it will. We can hope that the "assets" the Government acquires for the cash from the banks will actually bear fruit, but if you were the banks you'd be shovelling your crap towards HMG as fast as your shovel work go! What ever happened to productivity? Bend over and take your shafting!

Howden,

I somewhat agree with you there but QE figures need to be right, not too little and not too much. 7 years of QE didn't help Japan one iota but the B of E know where Japan (and Germany years ago) went wrong so hopefully our Money Men should get it right this time. If credit doesn't improve by quite an amount over the next 12 months or so, then we could be deep in the proverbial.

Dutchy,

It would be interesting to see figures in say 6 months time to see exactly how much money is being pulled out of savings accounts and spent, NS & I have pulled in more money from the start of 2009 than in the whole of either 2007 or 2008. Obviously a lot of this is down to worry about bank failures but not a lot is getting to the High Street yet. Again with QE, if they get it fairly right, inflation won't go sky high but if not we could be looking at 10,12,15% maybe, Ouch. TI am in total agreement that the Nu-Labour have made a mess of things over the last 12 years and GB started it in '97 when he raided the Pension Funds, people are still paying for that today and will do so for geneartions. remember that old song "Wreck of the ol' 97" performed by many artists such as Johnny Cash, Hank Snow and Boxcar Willie? I wonder if Tony Blair will dust off his guitar and back Gordon Brown on Pop Idol doing his song after the next election.... brings tears to my eyes....

Sorry to hear you lost out on both shares and property investments, my old next door neighbour lost out in the 1987 crash pulled out his diminished money before the rebound and then pumped it into property for the decline from 1989 to 1992 and sold up again. I hope you get some sort of improvement on your returns in the next few years. probably when GB goes.

I think QE will be more of a "kick start" for the economy.

Am interested in seeing if this and todays cuts will see banks start to adjust their 3 / 5 / 10 year fixed mortgage rates - the spreads are far too high on these products. Been keen to see how Northern Rock and RBS position themselves with these products

Anyone hazard a guess to when the first raft of deals will be released ?

A new, all-time low - half a percentage point rate cut - and the sixth consecutive cut since October 2008.

Another unpopular rate reduction

What do you think? Is this the final 'kick start' the economy needs?

I'm just thinking as the past interest rates cuts did not work at all and banks are still not lending to businesses even when most of them are government owned, why is the Bank of England (read. Government) still cutting interest rates?

The only reason I can come up with is to force savers out of their saving accounts and force them to spend their hard earned cash.

To make it even worse, the government is going to print more money, so savings will even be harder hit due to inflation.

The way I see it the government is trying to get their fingers on our savings to 'safe' the economy that they ruined in the first place.

Under this government we lost our money when it was invested in shares, then we lost our money when it was invested in property and now our savings are under attack.

Today's paper's agree - they appear convinced it will be half a percentage point cut, taking Bank rate to an historic low of 0.5%...

Anyone reckon they'll go the whole hog and slash base rate to 0%? Quantitative easing, here we come?

Mine tell me the same, but will it be 1/4 or 1/2 percent?

I reckon 0.5% drop in UK rates and 0.5% on ECB rates too for March 5th meeting

I just looked at both my balls, and there will be another cut on Thursday.

What are people seeing in their crystal balls about interest rate cuts this month?

Will they be cut again?