The Bank of England voted to leave monetary policy unchanged on Thursday with interest rates at the historic low of 0.5 per cent and £200bn of newly created money pumped into the economy to boost the recovery.
At its crunch August meeting, the Monetary Policy Committee’s considered verdict on June’s emergency Budget is that it will not undermine the recovery sufficiently to warrant taking offsetting action.
It has also judged that inflation is not enough of a concern to begin to raise interest rates, even though prices in June were 3.2 per cent higher than a year earlier and inflation has been at least 1 percentage point above the Bank’s 2 per cent target throughout 2010.
