Lord Mandelson, Business Secretary, has put pressure on the banks today, by warning them that their customers will not be best pleased if the interest rate cuts are not passed on.
This warning comes after David Hodgkinson, chief operating officer of HSBC (who travelled with Gordon Brown to the Gulf), warned consumers they might not see any benefits if the Bank of England cuts interest rates this week.
Lord Mandelson, who is also in the Gulf, is quoted in The Times:
"I have to say when official rates are being cut it's not unreasonable for the customers to expect to see some benefits.
People want to feel the benefits of that action. And if it appears the banks are standing in the way of what the government is doing then I think many banking customers are going to be asking difficult questions of the banks.
I must say one of the things that has struck me going round the Gulf is the extent to which our own British PM is now being looked to as someone who will lead the rest of the world out of this mess.
If we can't even have a response in our own country to his moves, to his decisiveness, that will come as a surprise to many."
When Libor comes down so will interest rates charged by banks to customers, that is the key.