Brokers say base rate will remain at its current level for some time following the Bank of England’s decision last week to keep it at 0.5 per cent for the 19th consecutive month.
The monetary policy committee also decided to maintain the quantitative easing programme at £200bn.
Savills Private Finance managing director Mark Harris believes bank rate could remain at its current level for the next two years. He says: “I think it would be a good bet to say that base rate will be sitting at 0.5 per cent for the next couple of years. I think it is too early for us to think about fiddling around with it, lots of things have to fix themselves first before they start to push it up.”
Emba group sales and marketing director Mike Fitzgerald adds: “With the talk of more quantitative easing and the Government looking to cut jobs, inflation has to go on the backburner. I cannot see rates going up or there being any movement for quite some time. I do not think that people realise how bad it is out there. Once unemployment starts to bite, the situation is going to be bad.”