News: BoE hold rates for eighth month

The Bank of England’s Monetary Policy Committee voted to hold interest rates at 4.5% again today, deciding no action was required to balance aiding economic growth with keeping inflation in check.

This was the eighth month in a row that the two-day committee meting decided to keep rates level. Economists had widely predicted the action, with not one out of 42 analysts polled earlier this week prepared to consider any other outcome of the MPC meeting.

Some analysts are now predicting that interest rates will stay at 4.5% for the rest of the year, although about half still say a cut later in the year is possible.

However, a new lease of life for the presently recuperating housing market, which could take off given the economy is recovering, could cause the Bank to consider a rise in interest rates, other analysts predict.

The previous change in interest rates was a reduction of 0.25 percentage points to 4.5% on 4 August 2005

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