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20 Dec 07 - Further Interest Rate Cuts 'Likely'
Analysts believe that interest rates could be cut further
after Bank of England policymakers said "significant" action
may need to be taken to protect the UK economy.
Minutes from the Bank's December meeting reveal that all
nine members of its Monetary Policy Committee voted to cut
rates by a quarter point to 5.5%.
On that basis, economists now believe that there could
be a second successive cut in January, and that rates could
end 2008 nearer to 4% rather than the 5% previously expected.
The Bank's minutes also reveal a willingness to take more
decisive action as fears mount about the impact of recent
volatility in financial markets on a slowing UK economy.
Global Insight economist Howard Archer said: "The MPC has
clearly become significantly more concerned about the growth
outlook and the dampening impact of the credit crunch, and
is prepared to act despite ongoing concerns about near-term
inflation risks."
News items supplied by SelectNews, produced by PA Business,
part of the group that owns The Press Association, the UK's
national news agency. Copyright (c) PA Business 2007.
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