Reduction in interest rates good news for the travel industry
By Darren Cronian on Thursday, November 6th, 2008

I am no financial expert but the news today that the Bank of England have reduced mortgage rates by 1.5% must be good news for the travel industry. I suppose this depends though if the banks and building societies actually pass this reduction down to homeowners.

Reduction in interest rates good news for the travel industry

Will a lower mortgage see travel consumers rush to the high-street?

For me, the news of the reduction in interest rates will not have any impact on my bank balance because I am one of the growing number of people who rent and do not own a house. That suits me though because I love my apartment, and for the years whilst mortgages have been increasing, I have seen my rent stay the same.

I would be interested to hear what impact this will have on your holiday plans next year.


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2 responses to “Reduction in interest rates good news for the travel industry”

Karen Bryan | 7 November, 2008 at 9:37 am

There seems to be uncertainty over how much of the 1.5% reduction in the Bank of England base rate will be passed onto consumers. Banks are trying to protect their margins and are still not keen to lend to each other which keeps the rate of interest that they charge to each other high.

I think that there’s still the fear of redundancy and wage freezes for many employees and high energy prices so I don’t envisage a great rush to book holidays, solely because of the cut in the base rate.

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Mike Walsh | 12 November, 2008 at 12:45 am

Most banks have now passed on the full 1.5 point cut. I don’t think it will itself spark a rush in travel bookings, but it needs to be the first in a series of measures that revive a feelgood factor among consumers. Gordon Brown’s hints of tax cuts could be the next such measure. Tour operators and travel agents will be hoping so!

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