The Bank of England has kept British interest rates steady for a third month running at 5.75%, as expected.
Many economists believe, however, that the bank will cut rates later this year as a credit crunch in global markets starts hitting the wider economy.
Policymakers have said they need time to see what effect recent market turmoil has on economic growth and inflation.
A few months ago many economists had predicted a further rate rise this year following five since August 2006. But this was before the global cash crunch which prompted a run on British mortgage bank Northern Rock last month.
There are worries that this will soon spill over into tighter lending conditions on companies and consumers, slowing the economy as a result.
The BoE has said it will watch credit conditions closely and many economists believe rates have now peaked and could come down as soon as November.
