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3 Mar 08 - Bank Tipped To Keep Rates At 5.25%
Economists believe that the Bank of England will freeze
interest rates this month due to concerns over the rate
of inflation.
Most analysts are predicting that members of the Bank's
Monetary Policy Committee will leave the official cost of
borrowing at 5.25% as they try to tackle the problem of
rising costs.
Both oil and wheat prices reached new record levels last
week, which will put more pressure on the UK's cost of living
index.
Last month, surging petrol and food prices were blamed
for causing the official rate of inflation to rise to 2.2%,
while March's inflation rate could be even higher as households
begin to feel the effect of double-digit price rises for
gas and electricity.
Members of the MPC have already voiced their concerns over
inflation, with Andrew Sentance telling business leaders
in Devon that "our mandate is to keep inflation on
target", while Rachel Lomax said that the Bank will
need to tolerate slower demand to keep inflation on target
if "inflation expectations appear to be persistently
elevated".
News items supplied by SelectNews, produced by PA Business,
part of the group that owns The Press Association, the UK's
national news agency. Copyright (c) PA Business 2007.
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