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Economists question Banks&#39 50-point cut

Leading economists have questioned whether this months 0.5% drop in interest rates was a cut too far.

Concerns that the Bank of England has overestimated the threat of recession appear to be justified by the Bank&#39s own deputy governor, Mervyn King, who rates the UK&#39s chances of recession at only one in 10.

The minutes of the MPC meetings in August, September and October reveal just how fine a line the committee treads between boosting confidence and stifling inflation.

At the emergency meeting called after 11 September, two of the MPC&#39s eight members called voted for a 50-basis point reduction, arguing that the 25 points eventually passed on were “overly cautious” and ran the risk of adversely affecting confidence.

In October, however, MPC members concluded that a 50-basis point cut could “damage rather than sustain” business confidence. They voted for a 25-point reduction on 4 October.

The minutes of the MPC&#39s November deliberations will be published this week. House prices indices, manufacturing output, employment and reports by regional agents are among the factors that influence the committee&#39s decision.


BSA dismisses carpetbaggers

The Building Societies Association has dismissed suggestions that its members face renewed threats from carpetbaggers after a manufacturing executive said he would stand for election to the boards of directors of the Nationwide, the Portman and the Coventry. Tim Tanner is the founder of Mutual Members, a group of building society members who campaign for […]

Don&#39t believe the doom-mongers

According to the Nationwide Building Society and the Halifax House Price Index, house prices dropped in October by 0.5%, yet only a few weeks before these two major lenders could not agree on the state of the property market. Halifax claimed that it had ground to a halt, while Nationwide quoted figures that showed a […]

L&G toolkit to support partners

Legal & General has launched a toolkit to support its business partners and help them meet the requirements of the Mortgage Code Compliance Board. The first part of the toolkit concentrates on the requirements for fitness, with the second section, covering training and competency, due to be published in the nest few weeks.

Chameleon launch from Pink

Mortgages plc and Pink Home Loans have teamed up to launch Chameleon, a tracker mortgage range available only to brokers who submit business through Pink. Chameleon is a range of bank base rate tracker products designed for sub-prime borrowers. The range is tiered with rates starting from 6.25% (APR 6.55%) for loans of 50% loan-to-value.

Auto enrolment – so far so good?

Jamie Clark – Business Development Manager The recent report from the Pensions Policy Institute demonstrates the sheer scale of auto-enrolment so far and what we can expect in the future. We’ve pulled out the key information to save you reading the full report. Auto enrolment in numbers Sources: Pensions Policy Institute, The Future Book: Unravelling […]


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