9 Nov

Interest rate held at 5.75%

Interest rate held at 5.75%

The Bank of England has opted to freeze the base rate of interest for the fourth successive month - stymieing hopes that homeowners would be handed a financial fillip.

The Bank's monetary policy committee (MPC) held the rate at 5.75 per cent - a move widely predicted by economists.

However, a cut is expected however within the next few months, as the impact of the credit crunch deepens and the Bank moves to relieve pressure on banks.

Trevor Williams of Lloyds TSB said: "Although it is true that economic growth may have peaked in the last quarter and is slowing in the current one, there is still some way to go before the MPC would need to wield the knife on base rates.

"And with money supply still growing, strong labour market conditions and continuing robust economic growth, today was clearly not the day for a cut. Equally, with early signs that the economy is set to weaken in 2008 and price inflation still comfortably below target, the Bank was never really likely to raise rates.

He added: "The next move will almost certainly be down, but it's safe to say there won't be any change until February at the earliest."


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