There was good news for borrowers and mortgage lenders this week as the MPC, the Monetary Policy Committee, again voted to keep interest rates at 0.5% for the 17th month in a row. According the meetings minutes only one member of the MPC, Mr Andrew Sentance, voted for a rise from 0.5% to 0.75%, to deal with rising inflation. This is the third month in a row that Mr Sentance has argued for a rate rise. Although the news is good for borrowers, the news is not so good for the millions of retirees who rely upon the interest earned from their savings accounts and other investments.

During the meeting the committee also agreed that another round of quantitative easing (QE) was not currently necessary. QE is a monetary policy used by central banks to increase the supply of money by printing more of it. The money which now tends to be created digitally is then used to purchase financial investments and assets from banks, alleviating certain financial restraints and pressures. During the financial crisis the Bank of England pumped in over £200bn to the UK economy, although the MPC has ruled out more QE at this time the committee stated that it was prepared to continue the policy should the situation demand it.

Despite fears of a double-dip recession, the MPC stated that it wasn’t overly concerned with rising prices and inflation. According to James Knightley at IGN the bank is more concerned with securing the recovery, rather than fighting inflationary prices. In a statement to the BBC he suggested that “Given growth is going to slow due to the severity of the UK's fiscal austerity package, and with lead indicators and consumer confidence already softening, we doubt the Bank will look to raise rates until next year at the earliest”  

I assume that this both took a long time to learn and hurt alot