Interests Rates Held...Again
The Monetary Policy Committee has held the base rate at 0.5% – the level to which it was reduced in March 2009. Growth has been held back by low consumer spending and by government austerity measures starting to bite. Nevertheless, inflation has remained high driven mainly by increased fuel and energy costs along with the increase in VAT. It remains possible that further quantitative easing, on hold since Feb 2010, may be introduced to stimulate growth which continues to be very weak. The minutes of today’s meeting will be published on 17th August.