No change in interest rates
The Bank of England has decided to leave the interest rate unchanged for the moment. It was widely expected that the base rate would remain at 5.25% in March.
According to minutes of the meeting in February, members of the Monetary Policy Committee were strongly in favour of allowing more time to see the effect of previous increases before deciding on further action. The next set of inflation figures will be published on 20 March, the day before the budget is delivered by the Chancellor. Analysis and assessment of both are likely to influence future decisions on the need for any more rate increases.
There is still some way to go to reach the Government target of 2% inflation, although in February the figure did fall to 2.7%. Previously it had been at 3% which was the highest level for 11 years.
Some business advisors warn that another early rise in the interest rate could be damaging to business confidence and growth of the economy. This is a particular concern following recent falls in the international stock market. However, many economists still believe there will be another rate rise in the next few months, with April or May popular choices.
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