Home owners and borrowers were given fresh hope yesterday after an unprecedented intervention in the faltering financial markets by the world’s largest central banks. Financial Times, The Times, Daily Telegraph, Independent, Guardian

The Bank of England joined its counterparts in America, Europe, Canada and Switzerland in pumping billions of dollars, euros and pounds into the international money markets in a attempt to ease the credit crisis.

Struggling banks will be able to bid for the money, in the form of loans, to prop up their finances.

The unexpected move raised hopes that Britain’s mortgage lenders, who rely on the markets for funding, will now be able to cut the cost of borrowing for hard-pressed home owners.

Many banks and building societies have still not passed on last week’s quarter percentage point cut in interest rates, despite mortgage repayments being more expensive than at any time in the past 15 years. Rising living costs and higher rates on personal loans have placed added pressure on families.

Financial analysts predicted that yesterday’s intervention could help the economy avoid a wider recession and avert a housing slump.