BoE holds base rate and asset-purchasing budget

8 February 2013

The Bank of England (BoE) has decided to maintain the UK's interest rates and asset-purchasing budget, it has emerged.

It was announced yesterday (7 February) that members of the central institution's Monetary Policy Committee (MPC) have voted to keep the base rate at its historic low of 0.5 per cent and the issuance of reserves at £375 billion ($590 billion).

According to the BoE, this decision has been made on the basis that the country's economic situation remains fragile, as there has been "considerable volatility in quarterly output growth" over the course of the last 12 months.

The nine members of the MPC indicated that overall output has been flat in recent months, mainly due to the "sharp falls" seen in particular sectors of the economy, although this trend has been offset by the modest expansion in manufacturing and services.

Lee Hopley, chief economist at manufacturers' body EEF, said the BoE's decision had not come as a surprise.

By Gary Cooper

Become a bobsguide member to access the following

1. Unrestricted access to bobsguide
2. Send a proposal request
3. Insights delivered daily to your inbox
4. Career development