Bank of England holds Interest Rate
The decision on whether to cut, maintain or increase interest rates has become increasingly difficult as The Bank of England has maintained a policy of "wait and see" with the state of the UK economy.
After last month’s decision to hold rates at 5 per cent the minutes show that seven of the nine MPC members voted to hold the interest rate whilst one member called for a cut and one other for a rise in the cost of borrowing; that’s the first 3-way split since May 2006. The MPC admitted that the economy "remained fragile" in the midst of rising costs for small business, big business and consumers alike.
House prices have continued to fall, businesses struggle and some economists have tipped inflation to rise to as much as 5 per cent by the end of the year so the decision will not have been taken lightly.
Meanwhile, in America, the Fed kept US interest rates unchanged.
The MPC’s inflation report is due to be published at 9:30am on Wednesday 13th August and the minutes of this decision are due on the 20th August.