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Amid signs of a UK economy slow-down, the Bank of England has cut interest rates to 5.25% from 5.5%.

This was a widely expected move by many analysts. Some experts had predicted even more cuts similar to the US Federal Bank’s move.

However, the Bank signalled that further cuts were not imminent due to inflation concerns.

In its statement, the Bank said: “Inflation at 2.1% in December was close to the 2% target, but higher energy and food prices are expected to raise inflation, possibly quite sharply, in the coming months.”

“The Committee needs to balance the risk that a sharp slowing in activity pulls inflation below target in the medium-term against the risk that elevated inflation expectations keep inflation above target,” it added.

Some key players in the property sector are still not satisfied that this move will be helpful for the UK housing market. They are pointing to the data indicating that market activity is 25% down on a year on year basis in terms of mortgage lending and sales volumes. Most people, however, seem in agreement that in 2008, a potential housing crash is very unlikely.