Fear that America was about to tip into recession yesterday wiped £77bn off the value of FTSE shares, the biggest one day plunge in London since the terrorist attacks of September 2001. Speculation that booming economic powerhouse China could be infected by the sub-prime crisis helped to trigger a global sell-off which resumed again this morning. Shares rebounded after the US Federal Reserve slashed interest rates by 0.75%, their biggest rate cut in living memory, in an attempt to pull the world’s biggest economy away from a recession. The pain on the British High Street was further evident today when the shoe-shops chain Dolcis founded in 1863, went into administration with accountants KPMG now running the business.
Posts Tagged ‘rate cut’
Black Monday - Biggest stock market drop since 9/11
Tuesday, January 22nd, 2008Many lenders failed to pass on rate cut
Wednesday, January 9th, 2008According to figures, eighteen of the 103 mortgage lenders failed to pass on any of last month’s interest rate cut, while sixteen reduced their rates by less than the full 0.25%. However, many banks and building societies have taken the opportunity of the interest rate cut to reduce their savings by more than the 0.25% reduction in base rates. A total of 117 providers have so far cut their savings rates, with just 15 leaving them unchanged. Alliance & Leicester has made the biggest reductions to its savings by slashing rates by up to 0.5%, while HSBC has reduced some accounts by up to 0.49%. Britain’s biggest mortgage lender Halifax and Bradford & Bingley have both cut rates paid to savers by up to 0.4%, while a number of banks and building societies, including Britannia, Royal Bank of Scotland and NatWest, Yorkshire Bank and Sainsbury’s have decreased them by 0.3%. Will another rate cut mean banks carry on cheating customers even more?
Rate cut or rate hunch?
Tuesday, January 8th, 2008The Bank of England will come under intense pressure to cut interest rates this week as figures out show that the high street suffered its worst Christmas for three years. Retailers endured another difficult day on the Stock Exchange amid mounting fears of possibly one of the toughest trading spells in recent memory. The gloom surrounding the economy may deepen if, as expected, Halifax reports that house prices fell again in December for the 4th consecutive month - making a case for a speedy rate cut. However, many economists believe that fears over inflation, fuelled by record petrol prices and rising gas bills, may force the Bank of England to wait until February or March before taking the next move down. The decision on interest rates will most definitely be a close call.
