UK interest rates remain at 0.5 per cent

The Bank of England's Monetary Policy Committee today voted to maintain interest rates at 0.5%.

The Committee also voted to maintain the stock of asset purchases financed by the issuance of central bank reserves at £200 billion.

The previous change in Bank Rate was a reduction of 0.5 percentage points to 0.5% on 5 March 2009.

Barry Naisbitt, Chief Economist at Santander UK, said: "A familiar story - there was no change from the Monetary Policy Committee (MPC) on rates again today.  However, after last month's three way split vote, financial markets will be looking to the minutes of the meeting and, more particularly, the Inflation Report to get a better sense of how the MPC is now thinking.  For the past few months one MPC member has been voting to raise rates and last month another member voted for more quantitative easing.  With inflation still well above its target and the increase in GDP in the third quarter ahead of market expectations, it will be interesting to see if the voting pattern changed.

"As usual, the key to this month's decision will have been how the MPC judged the prospects for inflation and the economy generally.  The US Federal Reserve has just announced more quantitative easing, reflecting the lack-lustre recovery and continued very high unemployment.  The future for the UK economy remains uncertain and there are concerns about a weakening of growth ahead, so the MPC still has its foot hard down on the accelerator pedal.  The Inflation Report is likely to give us a better indication of whether it is likely to ease back a little or if it is more likely that it will press down even harder."