The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Foreign Exchange

The new paradigm

Clearly, we are in a new paradigm and apparently independent central bankers around the world are playing a new game.

When I was buying my first property 25 years ago, the mortgage rate in the UK was around 11.3%. Since then, it has at times been painfully higher, and for the past decade, thankfully lower as the graph of UK banks’ base rates shows. Earlier this year, I negotiated to move on to a tracker mortgage. And while I will allow myself a pat on the back, I will also confess that I never imagined I would see the amount of interest I pay fall to the level it has following the Bank of England’s decision to cut its key rate to just 2%. The astonishing thing is that rates appear to be going even lower.

Clearly, we are in a new paradigm and apparently independent central bankers around the world are playing a new game. Where once they all followed the leader and tried to prove how tough their anti-inflationary credentials were, they are all now, as Bank of America hints in research yesterday, engaged in a rate-cutting championship.

UK's central bank base rate 
 Source: Bank of England

“Extraordinary times make for extraordinary decisions, and laggards can become front-runners in no time.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree