Brown says rates could fall further

LONDON (Reuters) - Prime Minister Gordon Brown urged banks on Thursday to pass on the Bank of England's one percent interest rate cut to their customers and said rates could fall further.

"If the banks pass the interest rate reduction on, and I hope and believe that they should do so, then it's of benefit to homeowners and businesses right across the country," Brown told BBC radio.

"Interest rates are at one percent in America now and they're at over three percent in the European Union. I think they will come down as well."

The European Central Bank cut rates by a record 75 basis points to 2.5 percent on Thursday.

"You will see interest rates at a relatively low level for some time now because inflation and the cost of oil is coming down. Interest rates could continue to come down," Brown added.