Official borrowing costs have continued to decrease for six consecutive months however the Monetary Policy Committee at the Bank of England presume the descending rates alone will not save our diminishing economy.

The term for this radical unchartered territory is known as "quantitative easing" (QE) for printing additional sterling to inject the money supply banks are reluctant to lend. However the majority of the 4 million tracker mortgage borrowers influenced by official rates will see repayments fall following yesterdays decrease. Meanwhile, Lloyds TSB, Halifax, Skipton Building Society and Nationwide are distributing the cut in full to standard variable rate mortgage holders but the majority of other lenders are unlikely to follow suit to protect their savers.

Under the latest QE scheme, the Bank will make £75bn new money to pump into the economy over the following three months whilst preparing for an additional £75bn if need be. Conservatives proclaimed the plan is a leap in the dark and could potentially skyrocket inflation and could encourage banks to sit on the newfound money in order to rebuild their balance sheets.

Although Alistair Darling has acknowledged many of us rely on savings for income with rates literally disappearing and having the same affect on their capital, he continues to insist the necessity of his actions and believes similar strategies will impart throughout the globe over the next period with a focus on the whole economy and assisting the growth of businesses. The Bank of England improving the money supply in conjunction with the low interest rates seems to be the Chancellors sure fire plan of aiding the country out of recession, however only time will tell and with the looming risk of inflation could simply spiral the UK into the depths of financial turmoil as seen in Germany post First World War.

The falling base rates could also discourage consumers from keeping savings in banks and building societies which will only result in the further reduction of funding available via mortgage lenders. The decision to cut base rates sparked a string of angry savers protesting outside the Bank of England demanding better having seen returns on their savings plummet since October. Rates have been cut 9 months out of the past 15.

As consumers are receiving far less for saving, due to the near non existent rate could detriment the demand for savings accounts and may lead to banks and building societies charging for previously free services such as current accounts. Tracker mortgage holders are happy with the 0.5% rate accounting for approximately 40% of all home loans reducing the average cost of around £40 and for heavily mortgaged people with a £250k plus home loan have seen total monthly savings increase from £65 in October to £657 saving a total of £7,880 in repayments per annum.

Times are hard and the estimated 4% decrease in year on year output could decline further with negative reports from manufacturing, services and construction sectors and house prices falling at a record annual rate of 17.7%. February's 2.3% drop wiping out January's 2% rise now leaves the average home in the UK costing £160,327.

Leading economists fear rates could remain at their lowest level ever well into 2010. Only time will tell if the "leap in the dark" will pan out as planned.