The Bank of England have cut the base interest rate to 5%, a 0.25% reduction from last months rate.
The UK’s central bank vote each month and decide what to do based on a set of factors.
Each time they have a meeting, they are looking at all the markets involved whilst trying to keep the rate at a level which is affordable. However they also need to consider what will strengthen our economy not just in the short term, but for the future itself.
It’s a big responsibility!
This month worries about the rise of inflation amidst a fall in the value of the pound against the euro, spiralling problems in the lending and housing markets and a rise in fuel, energy and food costs (producing and transporting), have taken their toll and given the Bank a valid reason to drop the rates.
Read more about the decision at Interest Rates Reduced to 5%
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