Stuttering mortgage market 'puts pressure on Bank to cut interest rates'
Published On 1 May 2008
Weakening mortgage approval rates in the UK have put pressure on the Bank of England to consider cutting interest rates, an industry expert has said.Howard Archer, chief European and UK economist at Global Insight, said that it was likely the Monetary Policy Committee would cut interest rates in June and added that they could even move to help people get mortgages at their meeting next week.
Mr Archer was commenting after figures from the British Bankers' Association (BBA) showed that mortgage lending approvals weakened in March and that approval rates reached their lowest since September 2000.
He explained that this sort of data "heightens concern that the UK economic downturn is deepening" and also "adds to the pressure on the Bank of England to cut interest rates further sooner rather than later".
"We suspect that most MPC members would prefer to delay acting until June given current elevated inflation risk."
The MPC is set to make its announcement about interest rates in May next Thursday (May 8th).
