Official: Interest Rate Cut Again by 1 Percent: Will Banks Follow?

Midday today the Bank of England Monetary Policy Committee cut the base interest rate by a full 1 percent this follows last month’s shock rate cut of 1.5 percent which was the biggest cut in 27 years.

This move takes the key interest rate to its lowest level since September 1939 and now stands at 2 percent.

Lloyds TSB and vowed they will pass on any interest rate cut in full to their existing customers who are linked to the standard variable rate or tracker rate mortgage.

Halifax the mortgage arm of Bank of Scotland also said they would pass on the rate cut and not exercise the collar option in its tracker mortgage contracts.

Two on the twelve members of the Monetary Policy Committee urged for a larger cut of 1.5 percent. The European Central Banks (ECB) is widely expected to reduce rates by half a percent to fight against the eurozones first recession.

Source: Skynews