Apr
09

Bank of England holds rates at 0.5%

The Bank of England’s monetary policy committee agreed on Thursday to hold interest rates steady for the first time since last September and maintained its commitment to buy up to £150bn in gilts and corporate bonds.

The decision to keep interest rates at 0.5 per cent was widely expected, after rates had been cut by a total of 4.5 percentage points in the six meetings of the MPC since September.

The move comes amid fears that further rate cuts would hit banks’ spreads and profitability, which could affect their ability to lend, and that they might not be passed on.

The committee also agreed to continue with the programme of quantitative easing – creating central bank reserves mainly to buy up gilts – that it began after the last meeting.

The Bank of England

The Bank of England

Source: www.ft.com

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