Bank of England keeps interest rates at 0.5%

The Bank of England has announced that it is keeping interest rates at 0.5 per cent, which will affect consumers looking for savings interest rates.

Despite rising inflation, which has soared to 4.5 per cent in recent times, the financial institution's Monetary Policy Committee has chosen to keep rates at their record low for a 28th month in a row.

"In terms of economic growth, the UK shows little promise as consumers are still not spending and industrial production data out this week was also disappointing. Further stimulus is still needed for the UK for the time being - policy makers in the Treasury should perhaps be questioning the current VAT level," Angela McGowan, the Northern Bank chief economist, told the Belfast Telegraph.

Furthermore, the National Institute for Economic and Social Research said that the effects of one-off events in April have depressed the overall quarterly growth rate, however, despite this the underlying rate is still going to be weak.

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2011-07-08 13:09:57 © Moneyextra.com