Lowered Interest Rates
Last week, the Bank of England dropped the base interest rate from 4.5% to 3%, a decision which came as a surprise to many. However, the bank’s intent was clear: to initiate a reduction of interest rates in lending. In response, about 40 mortgage lenders removed their trackers rate products from the market so that they may review them. They say they hope to reintroduce them later this week. Banks reacted as well. By the end of last week, the London Interbank Offered Rate, or Libor, dropped over one percentage point, from 5.56% to 4.49%.
