Yes, it’s the first Thursday of the month again and the Bank of England’s Monetary Policy Committee (MPC) has held its usual monthly meeting to discuss the state of the economy. During the meeting it was decided by the committee that the current base rate of interest for loans and savings should remain at the same level of just 0.5 per cent for the next month.

This means that the base rate has now remained unchanged for eleven months. many individuals were beginning to worry about the cost of their variable rate home owner loan increasing, due to speculation about a possible interest rate increase, caused by higher inflation in December last year, but it now looks as though the cost of a variable rate loan will not go up until the Spring at the earliest, although a number of lenders are currently increasing their own standard variable rate for loans they offer.

Despite the UK officially leaving recession this quarter, the Bank decided to keep the rate at 0.5 per cent due to the “sluggish growth” which has been seen over the course of the past three months.

A spokesperson for the Bank of England said “Spending by households appears to have picked up a little, though this may reflect temporary factors. The rate of decline in business’ investment spending appears to have eased. And the world economy continued to recover, raising the demand for UK exports.”

“But credit conditions are likely to remain restrictive, while the need to strengthen public and private sector finances will also weigh on spending. On balance, the committee believes that the prospect is for a gradual recovery in the level of activity.”

It was also decided to maintain the level of Quantitative easing at its current level of £200 billion.