The slow down in the housing market has contributed to a possible cut in interest rates. Stagnant or falling house prices and their impact on people’s wealth could explain consumers’ sudden move to abandon past high-spending habits. The Governor of the Bank of England, Mervyn King, has hinted this may lead to a cut in interest rates. “There was a sharp slowing in the growth rate of disposable incomes from the first half of last year to the second half,” King said. The City believes King has paved the way for a rates cut this year. On a positive note King said the worst of the market’s slide was likely to have passed. “There are some fairly clear indications that the housing market has stabilised… I don’t think we see signs of enormous distress there at this stage,” he said. (Times)