Making Sense of the Economic Climate

Yesterday the Bank of England cut interest rates to 2% (lowest level since 1951) but is it actually going to help us.
It will help those who are struggling to pay our mortgages as repayments should become cheaper but not all banks are going to pass on the cut/ the cut in fall to customers. They are much quicker to pass on the cut to savers however.
Those without a mortgage and have savings are losing out, they did not borrow money they could not pay back yet they are the ones who are getting less income from their savings.
Earlier in the week VAT was cut by 2.5% was this the right decision? In my opinion no, this is not going to get people to start spending money again as people have no money. People are likely to buy the same and keep the savings to pay for other outgoings .
The retail sector is really starting to feel the pinch Woolworths, MFI and The Pier have all gone into administration and we could see many more go in the next few weeks/months.
I don’t think that the economic situation is going to get any better in the near future infact i think that it is going to get wose but hopefully we have all learnt a valuable lesson, do not borrow so much money! and let us not go back to our borrowing ways
Nicola crowston