After a seemingly interminable run of base rate increases, the Bank of England relented in the second half of this year, checking interest rates at 5.75 per cent and eventually cutting them in December to 5.5 per cent, the first cut in two years.

Many experts at the time warned that the cut wouldn't be enough to stave off a serious downturn in the economy and further reductions would be needed, and quickly. Many expect at least another two cuts of 0.25 per cent in 2008. But with soaring oil and food prices those clamouring for further rate cuts are beginning to sound a little less confident.

MoneyExpert.com: "Credit crunch or no credit crunch, the Bank of England will need to balance the demands of a slowing economy with all too evident inflation."

So with opinion seemingly split on whether further cuts are needed, independent UK financial services comparison website MoneyExpert.com gives its predictions for 2008:

Essentially we shouldn't be getting too excited about big further reductions in the base rate. In August 2005 when it was pushed down to 4.5 per cent, many, including a lot of city economists, were hugely excitable, predicting a rate of 4 per cent by Christmas. Things didn't turn out that way with the next move, albeit a year later, being an upwards one. It's more than possible that we'll see a similarly cautious strategy from the Bank this time around.

Obviously things are coloured somewhat this year by the maleficent credit crunch, but it's also fairly obvious the problem there isn't just about interest rates but uncertainty between banks, and high interest rates in the wholesale money markets. Above all it's the possibility of banks being loaded with sub-prime debt from the US that's stalling the lending markets, not any policies of the Monetary Policy Committee.

Credit crunch or no credit crunch, the Bank of England will need to balance the demands of a slowing economy with all too evident inflation. With the Retail Price Index at 4.2 per cent, it could be a little while before the former trumps the latter, and those waiting for further cuts shouldn't be holding their breath.

Whatever 2008 holds, the market for the consumer remains hugely competitive, with ever increasing numbers offering high interest savings accounts, and more and more lenders vying for business.

Even if rates were to fall again early in the New Year, those about to come off fixed-rate mortgages could be in for a shock. People who were on 3 per cent fixed-rate deals taken out two or three years ago will be looking at average rates of around 5.5 per cent, and only some dramatic cuts will help avoid a painful re-adjustment.

For savers December's cut may have been unwelcome but customers are still benefiting from rates of anything from 6 per cent to 12 per cent. Further cuts will have consequences for the savings market so after any change in the base rate it's important to check your bank’s savings rates, and ensure you're on the best deal.