The Bank of England has, as expected, held interest rates at 5.75 per cent, on a good day for borrowers which also saw Abbey announce that it will reduce its fixed-rate mortgage costs from tomorrow.

The Bank's decision – the third such freeze in succession – could well now be followed by a cut in November, according to several leading analysts.

Jonathan Said from the Centre for Economics and Business Research (CEBR) and the Council of Mortgage Lenders (CML) have both suggested that a cut next month is now more likely because of current economic conditions.

Abbey, meanwhile, has said that its five-year fixes have been reduced by as much as 0.36 per cent, with ten-years down by a maximum of 0.25 per cent.

"Now is a good time to take out a long term fix. With the current uncertainty in the money markets, we found that nearly 40 per cent of homeowners would choose at a five-year fix or longer if they were to remortgage tomorrow," commented Abbey director of mortgages Sue Hayes.

But with the base rate now set to tend downwards in the coming months, borrowers might want to seek mortgage advice before making a long-term decision.