UK interest rates will remain at 0.5%, the Bank of England has said. This means that they continue to be at a record low. Also announced was that the Bank’s Monetary Policy Committee (MPC) will not be altering the £375bn quantitative easing programme.
Interest rates were originally dropped to 0.5% back in March 2009 to help deal with the recession. That was described as an “emergency setting” and has been in place ever since.
The quantitative easing programme, which pumps money into the economy, went unchanged as the country has still not reached the GDP levels it was at 6 years ago. This is despite increasing signs of economic growth.
Economists are now expecting the Bank to end its flagship forward guidance policy that promises no rate hike will be considered until the unemployment rate drops to 7%. This month’s MPC meeting is seen to be the final one before it is reshaped next week.
In its quarterly inflation report, Bank Governor Mark Carney said there were a “range of options” on how the pledge could be altered. This comes as the unemployment rate has dropped faster than predicted back in August when the guidance plan was created.