Interest rates `could fall to 3.25% in 2009`

7 October 2008

The base rate of interest in the UK could fall to as low as 3.25 per cent in 2009, an expert has said.

In news that may be welcomed by consumers experiencing high mortgage repayments and interest rates on other forms of loan, Howard Archer, chief European and UK economist at Global Insight, said that he believes the Bank of England (BoE) could significantly reduce interest rates over the period.

He said: "Rates could well be down to 4.5 per cent by the end of this year and then down to 3.25 per cent next year."

Mr Archer also expressed a belief that the interest rate, which currently stands at five per cent, will be cut next month.

Meanwhile, in a recent poll of 12 economists, seven predicted that rates will be cut when the BoE`s monetary policy committee meets on Thursday (Oct 9th), while five said it will opt to hold.

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