Rates held at 0.5% as BoE resists rise to combat inflation

 

 

Good news for borrowers, bad for savers – after much speculation whether interest rates would rise, the Bank of England decided on keeping the historic 0.5 per cent level for another month at least. 

 

Shock data last month showed Britain's economy went into reverse at the end of last year, and headwinds from tax rises and public spending cuts look set to persist for some time.

 

A rate rise is one of the major weapons the Bank can use to tackle inflation – currently well above its 2% target at 3.7% – but borrowers will be happy that the interest they pay on their debts will not rise.

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