7
Aug
Base rate stays at 5%
The Bank of England's monetary policy committee has announced that
it has decided not to change the base rate.
For the fourth successive month the nine-member body voted to keep
the base rate at five per cent as it seeks to balance the risks of
higher inflation and slower growth.
The decision means that the view taken by MPC member Tim Besley
last month that rates should rise has not been shared by his
colleagues.
Reference to this was made by director general of the Council of
Mortgage Lenders Michael Coogan, who said: "Holding the Bank rate
is better than raising rates, as one MPC member [Tim Besley]
suggested last month."
Mr Coogan added that those with mortgages will hope for a rate
reduction soon.
Following today's news, Royal London Asset Management economist Ian
Kernohan predicted that a reduction can be expected before
Christmas.
Minutes of the MPC meeting will be published on August 20th.
