5 Nov

FMB in two per cent rate cut call

FMB in two per cent rate cut call

The Federation of Master Builders (FMB) has called for the Bank of England's monetary policy committee (MPC) to undertake the radical step of cutting the base rate by two per cent tomorrow.

Following last month's 0.5 per cent rate cut, the MPC is expected to lower the base rate by at least as much tomorrow, with all 62 economists polled by Reuters forecasting this.

However, director general of the FMB Richard Diment said that only a huge cut would be enough to revitalise the building industry, commenting: "Dramatic economic conditions require dramatic, bold steps."

Such a reduction could help lower the cost of mortgages.

The lowest level the base rate has been at since the MPC was formed in 1997 was 3.5 per cent during 2003.

In that year, the MPC trimmed the rate to this level in February, before raising it by 0.25 per cent in July.

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