MPC sticks to low interest rate policy

THE Bank of England voted to keep monetary policy on hold this month with interest rates remaining at their historic low of 0.5 per cent and asset purchases at £200bn. The decision did not surprise City economists, who had widely expected the Monetary Policy Committee (MPC) to uphold the status quo for another month.

Although the economy grew relatively strongly in the second quarter, recent surveys have pointed to a slowdown in the pace of growth. Interest rates have been at 0.5 per cent since March 2009, though the central bank said it would pause asset purchases back in February 2010.

However, the minutes of the MPC’s September meeting – to be published on 22 September – are anticipated to be closely watched.