Interest rates held at 0.5%
THE Bank of England held interest rates at 0.5% today in the face of ongoing uncertainty in the global economy.
Disappointing growth figures had raised questions over whether the MPC should consider expanding its quantitative easing programme but the Monetary Policy Committee voted to maintain it at £200bn.
The decision to hold interest rates had been widely forecast as concerns about the rate of CPI inflation have been replaced by worries over the strength of the economic recovery in the UK and the ongoing Eurozone crisis.
David Ost, North West regional director at EEF, the manufacturers’ organisation, said: “There has been nothing since the Committee last met which would argue for a change in stance, so yet another vote to hold comes as no surprise. If anything, signs that the recovery may have lost momentum have pushed the inevitable rate rise further out into next year.
“While the Bank’s next Inflation Report will be closely watched, it is unlikely we’ll hear any change in tack from the view that risks are anything but skewed to the downside.”
Dr Brian Sloan, head of business and economic policy at Greater Manchester Chamber of Commerce, said the hold was ‘no surprise’ and the key issue was to establish: “what really can be done to get the UK’s economy back on a sustainable path back to growth.”
Amid numerous problems, such as the sovereign debt threatening the UK economy, Dr Sloan says action is needed to help the regions. 
“Increasing levels of employment legislation, employment taxes, excessive regulation and long drawn out planning processes were all tolerated during the illusion of the good times, but now expose an economy that is unable or unwilling to respond. The window of opportunity is closing and urgent and decisive action is required.”
