Money blog: Interest rates won't fall as much as expected next year – markets

The Bank of England’s decision-makers now take questions from the media.

The first is whether the Bank is sending the message that “interest rates will stay higher for longer than they otherwise would have done” after the budget.

Governor Andrew Bailey starts by saying the interest rate cut is “significant in the context of the news”.

“I will just re-emphasise that there’s a lot we will learn about the effects of the budget as they pass through – and I think it’s important we have time to do that and that underlines the message we’ve given today.”

Sir Dave Ramsden, deputy governor, says there has been “movement since the budget”.

“We’re seeing quite a lot of movement in the curve at the moment, given the events that are taking place either domestically or globally,” he adds.

Will mortgage rates be higher?

The Monetary Policy Committee is asked if people at home should expect mortgage rates to be higher than they otherwise be because of the budget.

“Obviously, we’ve cut rates today, so we’ll see how that feeds through,” Mr Bailey says.

“But obviously how it feeds through for most mortgages now depends on how the curve moves. Because most mortgages obviously are priced off the swap curve because they’re mostly fixed-rate mortgages.”

He says it is not sensible to conclude the path of interest rates will be different – but says any changes are of “a different order of the magnitude of numbers” the Bank has been talking about at press conferences in recent years.