Base rate remains unchanged at 0.5%

9 April 2009

The Bank of England`s Monetary Policy Committee has voted to keep its base rate at 0.5%, following nine consecutive cuts.

The Bank`s Governor, Mervyn King, had previously said it was unlikely that any further cuts would be made, following the decision to introduce quantitative easing into the economy to fight the recession.

The Bank has been subject to criticism from many analysts in recent months, who argued that base rate cuts were no longer effective and would disadvantage savers, who would suffer from record-low interest rates.

The decision to keep the base rate at 0.5% means that interest rates on loans and mortgages are unlikely to fall any further, and some lenders have started to raise their rates slightly.

A loans expert for Think Money said: "Interest rates are currently as low as they are likely to get in the foreseeable future, so anyone considering taking out a loan would do well to move quickly and try to obtain a competitive rate."

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