Finance experts think base rate will hold, poll finds

News Article - 05 August 2008
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All seven of the financial experts and institutions polled by Adfero believe the national rate of interest will remain at five per cent this month, it has emerged.

Management accounting departments in small to medium-sized enterprises might be interested in the predictions, which included responses from Lloyds TSB, HSBC, Royal Bank of Scotland and the Centre for Economic and Business Research.

The poll preceded this week's scheduled decision from the Bank of England's monetary policy committee (MPC), which is the body responsible for setting the base rate.

Howard Archer, UK chief economist at Global Insight, said it is "most likely" that interest rates will stay at five per cent.

"[The MPC has] got a difficult balancing act - in terms of the economy could be in recession but at the same time elevated price pressures," he explained.

This year has seen the base rate change twice. In February it dropped from 5.5 per cent to 5.25 per cent and in April it fell to five per cent.

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