Tweet
Bank of England holds interest rates at record low
Originally posted by 5corpio
The Bank of England gave struggling households some respite today by holding interest rates at a record low, as worries over the sluggish recovery outweighed concerns over rising inflation.
n the week when Scottish Power announced an average hike of nearly £200 in annual power bills, members of the Monetary Policy Committee (MPC) kept the Bank's base rate at 0.5pc for the 27th month in a row.
Howard Archer of IHS Global Insight said the decision reflected "major concerns within the MPC over both the current softness of the economy".
"The MPC obviously also has serious concerns about current elevated and rising consumer price inflation; but for now at least most committee members are prepared to hold fire on interest rates to give the economy more of a chance to develop forward momentum," he said.
The bank has warned inflation will rise above 5pc later this year and remain above the Government's 2pc target throughout 2012, before falling back in 2013.
However, data released since the Bank's last Monetary Policy Committee meeting confirmed that gross domestic product grew just 0.5pc in the first three months of the year after falling a similar amount at the end of 2010. Rate setters will also have been concerned by a loss of pace in the US recovery and flagging growth in the...........Click HERE to read more
n the week when Scottish Power announced an average hike of nearly £200 in annual power bills, members of the Monetary Policy Committee (MPC) kept the Bank's base rate at 0.5pc for the 27th month in a row.
Howard Archer of IHS Global Insight said the decision reflected "major concerns within the MPC over both the current softness of the economy".
"The MPC obviously also has serious concerns about current elevated and rising consumer price inflation; but for now at least most committee members are prepared to hold fire on interest rates to give the economy more of a chance to develop forward momentum," he said.
The bank has warned inflation will rise above 5pc later this year and remain above the Government's 2pc target throughout 2012, before falling back in 2013.
However, data released since the Bank's last Monetary Policy Committee meeting confirmed that gross domestic product grew just 0.5pc in the first three months of the year after falling a similar amount at the end of 2010. Rate setters will also have been concerned by a loss of pace in the US recovery and flagging growth in the...........Click HERE to read more