HC Deb 13 December 1984 vol 69 cc570-1W
35. Mr. Alan Howarth

asked the Chancellor of the Exchequer whether he is satisfied with the level of interest rates.

Mr. Ian Stewart

Interest rates have fallen back substantially from their July peak, and are now close to post-Budget levels which were the lowest for several years. But I should always like them to be as low as possible consistent with the needs of monetary policy.

41. Mr. Maples

asked the Chancellor of the Exchequer what assessment he makes of the relationship between the size of the public sector borrowing requirement and the level of general interest rates.

Mr. Ian Stewart

A sustained reduction in the PSBR should contribute to a sustained reduction in the general level of interest rates. But there are other influences on interest rates, particularly in the short-term. For example, higher overseas rates will tend to increase the level of United Kingdom rates consistent with any particular level of the PSBR.