No surprise as Bank of England cuts interest rates

The Bank of England, LondonAs expected, the Bank of England has cut the base rate of interest from 0.5% to 0.25%. As the chart below shows, this is the cut is the first change in seven years and takes interest rates to a new, all time, low. Whilst announcing the reduction, governor, Mark Carney, said: "We took these steps because the economic outlook has changed markedly, with the largest revision to our GDP forecast since the MPC was formed almost two decades ago." He added: "By acting early and comprehensively, the MPC can ...

Interest rates predicted to rise, what action should you take now?

Interest rates predicted to rise, what action should you take now 150pxAfter six years at an all-time low, the Governor of the Bank of England, Mark Carney, has suggested that interest rates could rise before the end of the year. Over the past few years we’ve all grown used to low interest rates; mortgage holders have enjoyed them, whilst savers have had to endure considerable pain. So with an interest rate rise predicted what action should you take? Mortgage borrowers If you have a tracker rate mortgage As the name suggests, the interest rate ...

Is deflation good or bad for your money?

Is deflation good or bad for your money?For the first time since Harold Macmillan was Prime Minister Inflation, as measured by the Consumer Prices Index (CPI), turned negative last month. But what does it mean for your savings, pensions and investments, we have the answers. But, first things first though, exactly what has happened? To put is simply, the CPI (usually) measures that rate at which prices are rising. It does this by comparing a ‘basket’ of goods and services from one month to the next and reporting the change. For the first ...

Savings: Interest rates to rise soon? Keep your options open with these five accounts

iStock_000015528657_ExtraSmallMark Carney, the Governor of the Bank of England, has said interest rates may rise sooner than expected. Financial experts now expect interest rates to rise in the first six months of 2015, or possibly as early as this autumn. But the speed of any rate rises is expected to be slow, with Carney saying: “We expect that eventual increases in Bank rate will be gradual and limited.” The news will come as a welcome surprise for savers, many of whom have given up hope of a rise in interest rates. But it ...