Thursday 15th May 2008
Future base rate cuts are likely to occur more slowly than was previously anticipated, according to independent mortgage broker Charcol.
Bank of England governor Mervyn King this week warned that the "nice decade" is at an end as the economy resets itself following an extended period of growth.
Charcol technical manager Katie Tucker now notes the "catch 22" situation in which the central bank finds itself.
She asserts: "Cut Bank rate and inflation rockets."
But failing to reduce the rates at which the banks can secure funds is likely to see a reduction in the level of borrowing available to consumers, Ms Tucker adds.
However, she observes that the monetary policy committee appears to have its hands tied in terms of stabilising the economy as quickly as it would like.
The Association of Mortgage Intermediaries recently noted that more first-time buyers are looking to intermediaries to help find the best product in the reduced market following the credit crunch.
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