7 Aug

Base rate stays at 5%

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.

Cookies We use cookies to ensure that we give you the best experience on our website. To find out more about our cookies policy, see our cookies policy here or in the footer.