7 Oct

CBI calls for major rate cut

CBI calls for major rate cut

The Confederation of British Industry (CBI) has called for the Bank of England's monetary policy committee (MPC) to lower the base rate by 0.5 per cent.

Speaking ahead of this week's monthly MPC meeting, CBI deputy director general John Cridland said: "The CBI believes that the Bank of England should cut interest rates by half a point when it meets on Thursday."

He added that this represented a change in the CBI position, as it had previously wanted a November cut but now argues the MPC should lower the rate sooner.

Such a move could help those looking for mortgages by lowering the cost of home loans.

Centre for Economics and Business Research economist Charles Davis has stated that a reduction is now a certainty.

He told the Evening Standard: "It is now a question of how much, not when they cut rates."

The last trimming of 0.5 per cent occurred in October 2001, in the wake of the September 11th terrorist attacks.
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