Tuesday, 23 January 2018

Bank of England keeps interest rates on hold

Bank of England

The Bank of England has kept its main interest rate unchanged at 0.50 percent, a month after increasing borrowing costs for the first time in a decade to contain a rise inflation stoked by last year’s Brexit vote.

Thursday’s decision was unanimous in the bank’s nine-strong policy committee. It was widely anticipated even though figures released this week showed annual inflation rising further above the 2 percent target, to 3.1 percent.

Policymakers at the central bank are predicting inflation to ease back next year as the initial impact of the pound’s fall following the vote to leave the European Union — it raised the price of imported goods like food and energy – fades.Policymakers are also wary of raising rates too much given the economic uncertainty surrounding Brexit, due to take place in March 2019.

The Bank of England is set to keep its main interest rate unchanged at 0.50 percent on Thursday, a month after increasing borrowing costs for the first time in a decade to contain a rise inflation stoked by last year’s Brexit vote.

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