Relief as interest rate is cut

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

The cut - the second in three months - comes as consumers increasingly struggle against tighter borrowing conditions amid the credit crunch.

Businesses and retailers welcomed the move, although some were left disappointed that the Bank had not made a more dramatic cut.

The Bank's Monetary Policy Committee (MPC) said the UK was seeing slowing growth and a drop in consumer spending, with households and businesses hit by the credit squeeze.

But it cautioned that soaring oil prices and higher energy bills may send inflation "sharply" higher in the coming months, highlighting the difficult balancing act faced by the MPC.

A raft of mortgage lenders were quick to announce they would be passing on the interest rate cut in full. Halifax, Nationwide, Abbey and Royal Bank of Scotland/NatWest were among those to confirm a 0.25% reduction in their standard variable rates.

There had been concerns that mortgage firms would fail to pass on the cut as the credit crisis has caused wholesale money market costs to soar.

Lenders' decisions to shave rates by a quarter-point will reduce monthly repayments on a typical £100,000 mortgage by around £16 a month to £722.80, based on a new rate of 7.25%.

The boost to households is much-needed at a time of soaring oil, food and higher energy costs, with E.ON becoming the latest to announce double digit increases in gas and electricity prices.

The Bank of England cautioned in a statement accompanying its decision that inflationary pressures could see the Consumer Prices Index (CPI) rise further above its 2% target.