It’s not a big cut, just 5% of 5.25% to 5%, in fact, a quarter of a percent or 25 basis points as they insist on calling it. It won’t, in the scheme of things, make much difference to your mortgage if you have one or your savings if you have any. It is, however, an indication of the ‘direction of travel’, in other words, rates will continue to fall over a period, probably of years. The consensus seems to be that around 3.5% is where they should eventually settle. Much higher, of course, than they were for some ten years, but nowhere near the 16% that many continue to remind me that they remember ‘and we coped so they should all just get on with it etc.’. Anyway, potentially good news for both our economy and your investments. Particularly if the US follows suit.
“Long live the 60/40 portfolio?”
Sounds a bit investment/tech/nerdy, I know. The ’60/40’ portfolio is what we call ‘Balanced’, with 60% in shares, 40% in fixed interest bonds, loans to companies and governments.
