4 Oct

Interest rates held at 5.75%

Interest rates held at 5.75%

The Bank of England has kept interest rates at 5.75 per cent for the third consecutive month.

The decision to keep the base rate as it is thought to have been taken to allow the Bank to take stock of the ongoing turmoil in international credit markets.

Economists had widely anticipated the move following evidence that the five interest rates since August was beginning to curtail price growth in the housing market.

Figures from the Halifax showed that house prices grew by 0.9 per cent in the third quarter of 2007 – down from 2.3 per cent in the previous three months.

Martin Ellis, chief economist at Halifax, said: "September's price fall is consistent with the normal behaviour of the market during a slowdown.

"A mixed pattern of monthly price rises and falls is a typical feature of a more subdued housing market."

The rate of annual house price inflation is also slowing, according to Halifax' figures, and is now down to 10.4 per cent, compared with 11.4 per cent in the 12-month period to August.

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