New Year Interest Rate Freeze

Bank of EnglandFollowing the usual speculative to-ing and fro-ing regarding the Bank of England’s Monetary Policy Comittee decision on the interest rate, the MPC has decided to freeze the interest rate at 5.5%.

After mixed results in the High Street this Christmas, with Seasonal Sales at 3 year Low, retailers have been particularly keen for an interest rate cut to boost the spending power of consumers. The TUC had also called for a quarter percent cut in rates to boost economic growth with other quarters calling for a full half percent cut in rates.

Add to that increasing inflationary pressures with the inflation rate at 2.1%, a little over the government’s target figure of 2%, plus the recent rate cuts in the US and the fact that the US may or may not be in or heading toward a recession, depending on who you believe, the interest rate freeze is either a confident stance on the UK’s financial status or a delaying action on an expected quarter percent cut in February.

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