Bank of England interest rates held

Posted: 09 Oct 2009 10:11:34 GMT

Bank of England interest rates were frozen at 0.5 per cent for the sixth month in a row yesterday (October 8th).

The base rate has now been at this record low percentage for seven months in succession after the Bank's monetary policy committee (MPC) brought the cost of borrowing down to its current level in March 2009.

Yesterday's decision, which was announced at noon, was widely expected by economists and property industry representatives.

Indeed, a number of these experts have indicated that they believe the MPC will maintain the interest rate at 0.5 per cent well into next year.

Benjamin Williamson, economist at the Centre for Economic and Business Research, goes further by suggesting that there will be no change throughout 2010.

"We don't see base rates lifting from 0.5 [per cent] in 2010; partly to counteract the expected sharp fiscal contraction, but also because the recovery does remain weak, so they have got to keep borrowing costs down," he explained.


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