is it not the banks fault in the first place? They are the ones constantly pushing everyone to take out huge loans and mortages, no one sells a house to make a loss! Then they turn around and decidde to cut rates on the fact that the UK people cant actually afford to buy anything as they are too busy cutting down their massive mortage bills and rate....

LB, Aberdeen, Scotland

Aren't low interest rates what got us into this mess in the first place? That and falling housing prices = Here we go again.

Guido, La Linea, Spain

I do not agree that it is the slightly higher interest rates that has been responsible for the problem in which we now find ourselves.
On the contrary, It has been the very low interest rates that has allowed people to borrow money so cheaply in the past that has created the absurdly high property prices and other financial difficulties. We need a correction to rectify this. No gain without pain! We will just find ourselves back to square one if we reduce rates.

pedro tam, london, UK

Neil, London. Surely the members of the monetary policy committee should have more professional and personal self-respect than to be used as political tools in this way. Either the BoE is independent, in which case it should have a major say in defining inflation, or it should throw the responsibility back to government so that we can all see that these are political decisions. As for 'spitting feathers' over the current announcement, my concern is not whether the BoE choose to raise or lower base rates, it's making statements which can be reported as forcasts for the year ahead. What's the point of regular monthly meetings, which can react to unexpected developments, if expectations are going to be set many months in advance? King may argue that he was reported out of context, but he should know by now to keep his lips tightly sealed. If reports of this type re-ignite property inflation and build the credit mountain even higher, we are in big trouble.

Clint, Staffs, UK

Is this "The Sun" or "The Times"? A completely misleading headline. Make no mistake about it...banks will not reduce their lending rate in the near future no matter what BoE do.

George, London,

Surely Mr King should not be allowed to make such comments in public as Banks, etc. will factor them in. Now what happens if things change next year, then we will have a knee jerk reaction if Mr King proves to be wrong which could be worse for the economy.

Sanjay Mazumder, Palmers Green, London, UK

Mrs Deeming,

Whilst I agree with your sentiment in some cases, it is near impossible to survive within your means on the average graduate starting salary (£14k - see Reform's IPOD report). The cost of house share rent, council tax, food, student loan repayments and public transport/petrol puts you above your salary in basics before you've even thought about fun money or saving for stamp duty and a house deposit. Even on £25k it isn't all rosy. Remember, our generation have not benefitted from the housing boom and are taxed more.

I think this is why some take a fatalistic approach and spend beyond their means in the hope that with promotion will come financial salvation. Personally, I've started my own business and am moving abroad next year instead.

anita, preston,

I would agree with Peter on this one, if the economy does crash then unemployment will be up and wage increases will plummet and also reduced demand will see inflation lower. The pound need to be lowered in order to help whatever is left of the UK manufacturing sector, just note how the US is allowing dollar devaluation order to reduce the trade deficit.

The next challenge is the lenders, they should not be allowed to create the next house price boom based on hot air. Must admit what a turnaround, as early as Aug 07 BoE were predicting higher rates.

Zak, London, UK

Irresponsible and misleading headline more suited to the red top tabloids. The bank is responsible for keeping inflation under control and as we all know the government does everything possible to fiddle the figures to the lowest possible. Inflation is already rampent and far above 2% in everyday living costs. The reality is the bank can have little influence on the causes of inflation, so better to prepare for interest rates remaining where they are or higher for quite some time to come.

John, Louth, UK

If they cut rates then they will devalue the currency and this in trun will cause inflation as well as inflation from consumers again overspending.

So Jackboy, be a bit careful about what you wish if you want any economy left after Prime Minister (Crash Gordon) Brown Unlect has finished with it. Interest Rates should sensibly be about 6.25% not the current 5.75%.

Oh and according to a recent Moneyweek article, as most of us know, middle class (read income?) inflation is running at about 7.1% already...

Jackboy, do you recall the romantic days of Red Robbo and pals ?

Pete Balchin, Solicitor , Bristol, UK

Jackboy, London. I thought that was what was being said. 'a downbeat govenour' etc. The economy has been mismanaged. Inflation figures have been seriously manipulated (especially by excluding property inflation), the UK is on the edge of a recession and its population is sitting on the biggest debt mountain ever. It might have escaped your notice, but the US has been experiencing a major property price downturn at the same time as cutting interest rates. On top of all of that, the BoE has failed to learn the vital lesson from Tony Blair, don't say or even hint at what you're going to do as you then lose the power to change your mind. Unless the BoE predicted the credit crunch and Northern Rock crisis and didn't bother telling anyone, it should shut up as its powers of prediction have been proven to be hopeless. If anyone is stupid enough to buy property now on the strength of King's 'hints', more fool them. Just watch him change his mind as some other unexpected event hits.

Clive, Chichester, UK

Victor M., Malaga. Be fair, the guy should be given some employment - sweeping floors is about right. I would keep the cash box locked up though, just in case he was tempted to invest some of it for me!

Clint, Staffs, UK

I find it amazing how these sort of articles always evoke an outpouring of scatter-gun vitriol aimed at anyone with any semblance of financial authority. The BOE is mandated with the difficult job of targeting a specific inflation rate over a lengthy time horizon by monitoring a huge number of parameters and to do so with one (blunt) policy tool - and nothing else. So quite why people are spitting feathers over their pensions, savings, other inflation rates etc is baffling. Save it for the government. Until the Bank's mandate changes to accommodate house prices, debt levels etc then it can only be judged by comparing its track record alongside its mandate.

Neil, London,

Completely agree with BS, Willerby from East Yorks. Just as the irresponible are about to get a wake up call the BoE presses the snooze button.

barry dupont, brighton, east sussex

So what makes mortgage-holders think that the banks will pass on rate cuts to them? The credit crunch is still here and most of the banks are losing money on all sides so the likelihood of them being in a position to provide cheap mortgages and liar loans again is very small.

This is pure spin to encourage people to keep on jumping into the market at high-risk prices.

MB, Edinburgh,

Spot on Tim. Add falling share prices...

Kara Swart, London, UK

So the hawks drove rates too high by 75 base boints. That's the message I am getting here. Is anyone going to say "sorry" and stand down? Actually I think the buzz word of Brown's Britain is "compensation". I'd like some now please.

Andrew Fanner, Cowplain, UK

Puzzled!

How can the BOE cut interest rates, thereby weakening sterling, increasing the costs of imports (which are the inevitable target of any increased spending) without causing more inflation?

John Maxwell, Skipton, UK

Maybe Jackboy should look in a little more depth at what is happening in the market rather than make silly remarks. Mortgage costs are increasing as the banks tighten credit, regardless of the BoE's moves, there's a large overhang of fixed to floating mortgages in the next 18 months and house prices in the US, Ireland, Spain and the Baltics are falling rapidly. So do you really think that the banks are going to start lending recklessly again just because the BoE cuts rates? Japan is probably in recession again, parts of Eastern Europe are imploding and China is starting to export inflation instead of deflation. The strength of the Euro is hurting European growth and oil is near $100. These are all facts, not forecasts. IF you really think that these facts will have no impact on the UK economy then you're in Dreamland. Whether its a mnor, moderate or major problem, nobody knows, but there's a problem.

Tim, London,

So, it looks like inflation will soar and savings will die. So much from prudence.

Steve, Penzance,

Is seems, once again, that people who spend recklessly have far more clout than those who don't. The message as ever is spend, spend, spend. The Government/BOE will look after you.

BS, Willerby, East Yorkshire, UK

What earthly use is a report worded in this way.
It is full of maybe's,could be's possibilities and conjectures one way or the other.
If he wants the pound to tumble then this report is guaranteed to be loved by currency speculators.
Bravo the borrowers,let's get house prices rising again.Poor owners finding that their house price is,at best,stagnant.What a shame!
Never mind the prudent saver. Naughty boy! Iit is his fault that business is hurting as he is not spending so much. Let's cut his interest so he has no incentive to save.
Of course inflation must continue to be understated.We don't want state pensions to rise too much.Also if we were honest there would be less talk of cutting interest and more of upping rates.
Mr King,you and the government are not a class act. Your problem is that you both find it impossible to tell the simple truth.

nic, Royan, France

The brilliant BOE deliberately advertising to the world their long term theories about UK interest rates falling thus depressing the value of the pound even further (now record lows against the Euro). I think these guys have some sort of 'death wish.' I wouldn't employ them to sweep my floors.

Victor M., Malaga, s

"Property investment haters", aka young people, Jackboy. A society that does not make adequate provision for it's younger generation is a society that is going to fail. And hopefully you'll still be around, dribbling in an old person's home, when that happens

Rachel, Edinburgh,

Er... Is the renewal of his position not coming under review shortly? This stance by King is weak and pandering directly to the Government.
The economic stability that this country has seen over the last 10 years has been driven by easy credit and low interest rates. It has resulted in over inflated property prices (which other than a few overpaid hedge fund managers and questionable Russian businessmen) no one else can afford. It has also resulted in huge levels of personal debt. Inflation is also rearing its head - look at RPI and not CPI. Given the total mismanagement of the economy over the last 10 years a recession was always on the cards. King should let it happen so that we can get it out of the way as fast as possible and hopefully without to much pain. All he is doing in cutting interest rates is storing up a bigger problem for later on!

IT, Surrey,

Interesting - maybe a certain high street bank could do with reading this article given they quoted an interest rate of over 15% (as opposed to their own advertised rate of around 8% and their competitors rates advertised rates of 6.5 - 7.1%) for a relatively small short term car loan yesterday.....

Puzzled, Niort, France

Even with a reduction to 5% our rate will still be 25 per cent higher than the euro rate of our competitors and definitely higher than the dollar rate which is going south. We'll still have by far the highest rates of a major western economy, and so don't expect plain sailing and a rosy future even with a 75 points cut. I fear that the BoE will cut too little too late to prevent a hard landing of the economy. And don't worry about inflation, the collapse in demand will see to that.

Peter, Lincoln, England

Where are all the comments from the property investor haters saying the banks wont reduce interest rates and everybody's gonna lose everything and the economy is gonna go into meltdown....
Maybe next time guys...

Jackboy, London,

Mary Mary quiet contrary how does your garden grow...

Robert Hexter, ex Notts, Vancouver BC

Inflation .. yea bring it on it might help to up my pay and reduce the real cost of my home loan/milstone

Andrew, truro, england

I find it very difficult to accept that people like us who have worked hard all their lives and not overspent by working within our budget should now pay by having reduced interest rates because people are not careful with their money and expect to be able to have what they want when they want even if they cannot afford it ! The old saying "Cur your coat according to your cloth springs to mind!"

Mrs B Deeming, Nuneaton, United Kingdom