Bank of England holds interest rates

Mark Carney, Governor of the Bank of England.

Mark Carney, Governor of the Bank of England.

First published in Business News

THE Bank of England has held UK interest rates at the record low of 0.5 per cent for another month.

The Bank also kept the size of its bond-buying economic stimulus programme unchanged at £375bn.

The news is in line with analysts' expectations, despite recent evidence that the UK economic recovery is strengthening.

Worries about rising house prices in parts of the UK have intensified the debate over when rates might increase.

With the UK economy growing stronger than pretty much every other rich country, markets expect the Bank of England to raise its policy rate in the first quarter of next year.

The Bank's Monetary Policy Committee (MPC) have kept rates at the historic low of 0.5 per cent for more than five years, amid worries that the finances of many individuals and businesses remain too weak to withstand a rise.

But the pace of economic recovery is picking up, and last week the Organisation for Economic Co-operation and Development (OECD) raised its UK growth forecast for this year from 2.4 per cent to 3.2 per cent..

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