Interest rates stayed once again at the record low of 0.5% as the Bank of England Monetary Policy Committee refused to move from its current stance of continuity.
For 30 months now, the base rate has been 0.5%. Interest rates haven’t remained the same for 30 consecutive months since 1950.
The Bank’s quantitative easing programme will also stay the same at £200 billion, in spite of calls from economists to extend the program further to pump more cash into the economy.
However the calls for quantitative easing will only grow stronger in upcoming months if the UK, like most of Europe is predicted to do so, veers closer to a double dip recession. QE is said to be one of the most ‘straightforward’ short term measures which can help boost a lagging economy.
George Osborne remained adamant today that a low interest rate is ‘key to economy’ and hinted that the 0.5% rate will stay in place for the foreseeable future, in his speech alongside head of the International Monetary Fund (IMF) Christine Lagarde in France.
Some economists predicted that 2013 would be the earliest a change in interest rates would occur.