Bank of England stays firmly on the fence
Saturday, August 09, 2008
Plenty has happened since the Bank of England last cut interest rates in April. Inflation has risen to 3.8% - almost double the government's 2% target - requiring the Bank's governor, Mervyn King, to write an explanatory letter to chancellor Alistair Darling. At the same time, the economy has weakened rapidly – today's news from the Halifax of an 11% drop in house prices over the past year is merely the latest evidence of a deflating property bubble.
Official figures suggest Britain continued to expand - if weakly - in the second quarter of the year, but all the signs are that the second half of the year will see the economy slide into its first recession in more than a decade and a half.
Against that backdrop, it was hardly surprising that the Bank's monetary policy committee left interest rates on hold today.
Article continues at Guardian news
Official figures suggest Britain continued to expand - if weakly - in the second quarter of the year, but all the signs are that the second half of the year will see the economy slide into its first recession in more than a decade and a half.
Against that backdrop, it was hardly surprising that the Bank's monetary policy committee left interest rates on hold today.
Article continues at Guardian news
Labels: Alistair Darling, Bank of England, chancellor, Halifax, Mervyn King, UK Interest rates, UK recession
