The Bank of England's monetary policy committee has announced plans to reduce the interest rate by 0.5 percentage points to 1.5 per cent.

Its decision leaves the interest rate at an all-time low, with landlords on tracker mortgages likely to benefit from the move.

However, experts have suggested that base rate cuts alone are no longer an effective tool in stimulating the economy.

Despite this, Neil Young, chief executive officer of property portfolio managers Young Group, said that homebuyers could still benefit from the decision.

Rates are now so low that banks will have more certainty, with little scope available for further cuts.

"This enables lenders to increase the confidence of their forecasts when planning products for the year ahead and should lead to an increase in their willingness to lend,"he explained.

Mr Young added that the base rate is unlikely to fall much further, meaning that it is now up to lenders to "go out there and perform"by passing on the cuts.ADNFCR-2002-ID-18964065-ADNFCR

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