39% of Brokers expect a Bank of England Base Rate cut by the end of the year, United Trust Bank has revealed.
33% of commercial finance brokers responding to United Trust Bank’s most recent Broker Sentiment Survey believe the Base Rate will be 0.5% at the end of the year and a further 3% believe it will be 0.25%.
41% of respondents believe that the Base Rate will remain unchanged at 0.75% throughout the year.
The survey was carried out by UTB between 13 December 2019, following the General Election, and 7 January 2020. Over 100 brokers working in the fields of property and asset finance took part.
Speculation that a Base Rate cut was becoming more likely followed reports that the UK’s inflation rate had fallen to 1.3% in December 2019, down from 1.5% in November. By the middle of January, market indicators were suggesting there was a 60% chance of a Base Rate cut on the 30 January.
Harley Kagan, group managing director of United Trust Bank, said: “With the potential impact of Brexit still uncertain and UK and global growth stubbornly lacklustre, a cut in the Base Rate wouldn’t be surprising.
“There is a chance that when Andrew Bailey begins his tenure as Governor of the Bank of England on the 16th of March, the Base Rate could be back down to 0.5%.
“Lower interest rates are good news for homeowners with variable rate mortgages and for those looking to borrow afresh or remortgage. They can also spur on SMEs to invest in their businesses and developers to green light new projects, actions some may have been putting off due to economic uncertainty. However, regardless of whether interest rates fall in the next few months, the cost of borrowing is and has been very low for some time.
“For those people and companies who see opportunity through the Brexit fog, United Trust Bank is ready and able to support their growth ambitions.”
