MPC ‘expected to cut interest rates’

A majority of financial experts are predicting that the Bank of England’s monetary policy committee (MPC) will cut the base rate of interest when they meet this week. Following March’s decision to hold the interest rate at 5.25 per cent, experts from the likes of Capital Economics, Barclays Capital, Nationwide and Global Insight are among those expecting the rate to be cut, potentially good news for those looking to buy a house in Scotland. Furthermore, Nationwide believes that by the end of 2008, the interest rate could be below five per cent for the first time since October 2006. “In the future we are anticipating that there will be two further rate cuts for the rest of 2008 and we’re expecting interest rates to come in at around 4.75 per cent by the end of the year,” the building society said. Lloyds TSB and HSBC are among those expecting a repeat of the March announcement of no change, with those looking to buy a house in Scotland no doubt hoping the minority are incorrect. The Bank’s MPC will announce their decision on Thursday.