Bank of England holds base rate at 0.50%

The Bank of England has announced that the base rate will remain at 0.5 per cent, those looking for cheap mortgages have been told.

Following a vote by the Monetary Policy Committee MPC, it decided to maintain the official base rate on commercial bank reserves at 0.5 per cent and keep the stock of the Asset Purchase Programme at £200 billion.

The decision marks the 25th consecutive month of no change since the base rate was reduced to 0.5 per cent on March 5th 2009.

Commenting on the result of the vote Barry Naisbitt, chief economist at Santander, said that the verdict will not have been come to lightly.

"Today's decision to hold rates is likely to have been another tight call. While the MPC again voted to hold Bank Rate at 0.50 per cent today, it is entirely possible that incoming economic data in the next few weeks will change the balance of opinion," he said.

Mr Naisbitt added that those looking for cheap mortgages should expect and increase in the base rate by mid-year.

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2011-04-07 13:00:45 © Moneyextra.com