5
Jun
Base rate cut has to wait as MPC votes to hold
Interest rates have held steady at 5 per cent as the Bank of
England today resisted pressure for another cut, although many
economists expect another cut soon.
The monetary policy committee (MPC) held firm again leaving rates
unchanged since April's 0.25 per cent trim.
That decision marked the third cut since December last year as the
MPC attempted to boost the sluggish economy.
However, rising inflation caused by soaring food and fuel prices
had led many economists to urge patience before another change, so
the full implications could be assessed in terms of spending and
wages first.
When the MPC last met in May only one of its nine members voted for
another cut.
Today's decision matched a Reuters poll last week of interest rate
predictions from 71 economists. Only two forecast a cut this time
but 40 predicted one would come before September.
