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Interest rates on hold after emergency summer Budget

By John-Paul Ford Rojas

Published 10/07/2015

Interest rates remain at 0.5% after George Osborne's emergency budget
Interest rates remain at 0.5% after George Osborne's emergency budget

Interest rates were left on hold at 0.5% as the Bank of England delivered its policy decision a day after Chancellor George Osborne's emergency summer Budget.

Rates have remained unchanged for more than six years and are not expected to rise again until next year.

The Bank's Monetary Policy Committee (MPC) is likely to have weighed up developments including accelerating wage rises and upward revisions to the UK's growth forecast against fears over Greece and disappointing manufacturing figures.

Yesterday's decision also saw the bank leave the scale of its money-printing quantitative easing programme unchanged at £375bn.

Details of the MPC's discussions, which are set to be published on July 22, will reveal whether the nine-strong committee remained unanimous on leaving interest rates on hold or if any of the members broke ranks to vote for a hike.

The pressure for any imminent need for a rate rise has been removed by the fact that inflation remains near an historic low of 0.1%, which is well below the bank's 2% target.

But in coming to a decision, the committee must also consider the path inflation is likely to take over the next couple of years.

Belfast Telegraph

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