News : Interest Rates held at 0.5 per cent
The Bank of England’s Monetary Policy Committee (MPC) have today voted to retain interest rates at 0.5 per cent, the same level since March 2009.
Eurozone fears, as well as weak consumer spending data meant the MPC decision came as no surprise, with many economists expecting rates to remain unchanged until well into 2013.
Retailers unveiled disappointing Christmas sales numbers this week, with shares in supermarket giant, Tesco down 10 per cent after it announced a decline in like-for-like sales of 1.7 per cent for the six weeks to 7 January, Argos and Halfords were other retailer to report lower sales.
In October 2011 the Bank of England announced that it would inject a further £75 billion into the economy through Quantitative Easing (QE), taking the current asset purchase programme to £275 billion. There is pressure to inject further funds to aid the economy.
Although the official interest rate remains at an all time low, mortgage rates hover quite a bit higher due to banks making an increased margin, it seems that mortgage rates of say 1% above the official rate are a long way off.
