Interest rate cut: 3 percent says struggling businesses

The Bank of England has been urged to cut interest rates by at least 1 percent this week by Business organizations and unions to avoid the recession. The British Retail Consortium and TUC have also put pressure on the UK’s retail banks to quickly pass on any interest rate cuts to mortgage holders who are finding it hard to make ends meet.

With the main threat to the economy shifting from inflationary expectations now to recessionary expectations the TUC pleaded with the Bank of England’s Monetary Policy Committee to take the interest rate down to at least 3 percent.

Drastic action by the Bank of England may need to be taken as a 0.5 percent slump in national income was shown in recent data for the third quarter, although economists anticipate a cut of 0.5 percent on Thursday. Central banks in Europe will also announce an interest rate decision on the same day as the Bank of England.

Source: Independent