The Bank of England will cut interest rates this week in a bid to bring mortgage rates back under control, leading economists said this weekend. Sunday Telegraph

Some Monetary Policy Committee members are even likely to argue in favour of a dramatic half a percentage point cut, amid growing evidence the credit crunch has gone from being a crisis in the financial markets to a full-blown economic problem.

The majority of City economists now expect the Bank to reduce the cost of borrowing to 5% on Thursday after new figures indicated that the economy is growing at the slowest pace in at least five years.