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Interest rate cuts

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I'm not sure why the Bank of England keeps cutting interest rates when it hasn't had any measured effect at all so far. With 60% of mortgages being fixed rate, and taking into account the households … Read More
melanie789 Avatar
8y, 5m agoPosted 8 years, 5 months ago
I'm not sure why the Bank of England keeps cutting interest rates when it hasn't had any measured effect at all so far. With 60% of mortgages being fixed rate, and taking into account the households who have no mortgage, the cuts probably only benefit 1 in 5 of us. On the other hand, all savers have been hit, and hit hard. Personally, I think it is wrong to use measures that penalise those who have saved, and rely on their savings for income, whilst rewarding those who have borrowed, sometimes irresponsibly, by handing them huge interest cuts. Fortunately, I put what little savings I have in a high interest fixed rate account a few months before the recession started, but I feel desperately sorry for those (especially the elderly) who rely on their savings, and are struggling to pay hugely inflated fuel bills etc. Wouldn't cutting direct and indirect taxes be a much fairer way of helping everybody, instead of targetting a small minority with interest rate cuts? P.S, I have a tracker mortgage, so it's not sour grapes. I just question the fairness of it.
melanie789 Avatar
8y, 5m agoPosted 8 years, 5 months ago
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#1
Because it is the only lever that the BOE has!
#2
I've got a tracker - yay me :)
I'm sure the bank of England base rate affects far more than just those with mortgages.
#3
bellabonkers
I've got a tracker - yay me :)
I'm sure the bank of England base rate affects far more than just those with mortgages.


It sure does - namely the sensible savers in society. The goverment is hoping that cutting the rates will send us all out to the shops in droves to spend our way out of the recession - but irresponsible buuying by people who couldn't afford it got us in this mess.
#4
The gov is not interested in savers as it needs them to spend, hence the rate drop so it's not worth saving, does mean once you spent it when you get made redundant you can claim JSA (can't with a set amount of savings) :-)

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