Will yesterday’s cut in interest rates bring relief to the government in its economic problems, offering a breather to people who feel that their living standards are declining? That is unlikely for two reasons. Firstly, people buying homes with mortgages – the most obvious beneficiaries of a cut in interest rates – are more likely nowadays to be on fixed rates. Few will benefit from an immediate cut to the Bank of England base rate; in fact, there are still many homebuyers who are coming off five-year fixed rates they took out at the height of Covid, when interest rates were still at near-zero. They will experience a shock, regardless of the fact the Bank of England’s base rate has just come down.

The recovery in real incomes, however, seems to be coming to an abrupt halt

Secondly, the

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