Interest rates hit all-time low

08 January 2009

The Bank of England has cut interest rates to 1.5%, the lowest level in its 315-year history, as it continues efforts to aid an economic recovery.

The half percentage point reduction brings interest rates below 2% for the first time since the Bank of England was founded in 1694.

Mortgage impact

Most mortgage customers with tracker deals will automatically have the cut in interest rates passed on to them by their bank or building society.

Customers with an average £150,000 repayment mortgage will see their monthly bill drop by £46.

Those tracker deal customers with a £250,000 mortgage will see their monthly payments drop by £76.

But those on standard variable rate deals must wait for a decision from their lender, most of which are currently saying their rates are under review.

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