On a 100,000 mortgage, the saving would be about 16 per month, according to the Halifax. Equally, interest rates for savers may not necessarily fall. But where they do, it will mean an even smaller return for the millions of savers who already earn little on their funds by the standards of the last thirty years or so. While most experts predict the cost of borrowing will come down again, Thursday's move may not be the start of a rate-cutting spree. The domestic economy is in very good health.
Consumer spending is robust, while the housing market is buoyant.
While a large tax give-away seems unlikely in the March Budget, consumers may still end up with more cash in their pockets. Against this background, the MPC may not want to cut rates too far or too fast - or else risk the economy overheating. Indeed, some say that rates could be on their way up again by the end of the year. The MPC was set up almost four years ago in May 1997, and is accountable to Parliament. During the first couple of years of its existence, it gained a reputation for being proactive when changing rates.