Interest rates: Expected to hold at 0.5%

5th May 2011

The Guardian reports that homeowners are "set for another reprieve" as the Bank of England monetary policy committee (MPC) opts to keep rates on hold.

It had been predicted to lift interest rates this month from 0.5% to rein in soaring inflation.

The Telegraph reports on the National Institute of Economic and Social Research's (NIESR) predictions of gross domestic product (GDP) growth of  just 1.4% this year.

This is 0.3pc below the Office for Budget Responsibility's (OBR) forecast, which was already adjusted down in the March Budget.

Simon Kirby, a NIESR economist, said the Bank of England's Monetary Policy Committee (MPC) was unlikely to raise interest rates because of the fragility of the economy.

House prices fell 0.2% in April according to the Nationwide Building Society.

See also: UK economic gloom wildly overdone


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