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Will interest rates fall?

A lot still remains uncertain, and depends on whether the recent turmoil in the financial markets that hit Northern Rock late last week continues.

"The outlook is now more uncertain," the September minutes of the Bank of England's interest rate setting Monetary Policy Committee (MPC) meeting read.

"The impact of financial market disruption will depend on how long it persists and how widespread it turns out to be. This is still very unclear."

For the last two months the MPC has voted unanimously to hold interest rates at their current level of 5.75%.

Before recent events involving the stock market, poor house price figures and the run on Northern Rock economists had predicted interest rates would keep rising and hit 6% or 6.25% before cuts arrived.

But now the most common prediction is for a freeze on the cost of borrowing for the next fe months followed by a fall.

"A modest cut in UK rates over the next six months is looking increasingly likely," said Richard Dingwall-Smith, chief economist at Scottish Widows Investment Partnership.

But the majority now believe interest rates will stay at their current level for some time.

"The Bank of England remains firmly in 'wait and see' mode for the time being, although we do anticipate that the next move in interest rates will be downwards," said Howard Archer, chief UK economist at the Global Insight consultancy.

"Some economists are starting to talk about rate cuts before year-end but I think the MPC is on hold for the foreseeable future," added Simon Ward, chief economist at New Star Asset Management.