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7 Mar 08 - 'Wary Bank' Holds Interest Rates
Policymakers at the Bank of England voted not to cut interest
rates for the second time in as many months amid fears over
inflation.
Instead the members of the Bank's Monetary Policy Committee
(MPC) left interest rates unchanged at 5.25% after reductions
in February and December.
There are growing concerns over the rate of inflation as
households are hit by hikes in fuel and food costs, and
increases in utility bills.
The MPC is charged with keeping inflation at 2%, but official
figures show that the rate is currently above target at
2.2%.
Because the committee is charged with keeping a lid on
inflation it has to be more cautious than policymakers in
the US - where rates have already fallen by 1.25% this year.
However, economists forecast that rates will fall to 4.75%
by the end of 2008, although most analysts predict that
the MPC will wait until May before easing rates any further.
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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