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No change in UK interest rates or quantitative easing


No change in UK interest rates or quantitative easing


The Bank of England has left UK interest rates at 0.5 percent for the 20th consecutive month.

It also kept its programme of buying assets, like government bonds, on hold.

That means – for the moment – there will be no extra cash injected into the economy through so called quantitative easing.

Analysts said there has probably been vigorous debate among bank economists on whether economic conditions require tighter or looser policy.

Mixed economic data combined with persistently high inflation have muddied the waters for Bank policy at a time of uncertainty over the global recovery and the impact of government spending cuts.

Most economists expect interest rates to stay at 0.5 percent until well into 2011.

Britain’s economy grew by a surprisingly strong 1.2 percent in the second quarter but growth is expected to slow sharply in the second half of the year.

House prices plunged a record 3.6 percent in September, according to mortgage lender Halifax, and consumer confidence has weakened ahead of the government’s October 20 public spending review which promises major cuts.

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