Bank of England keeps base interest rate at 0.1%

The Bank of England at its meeting on March 18 kept its base interest rate at 0.1 percent, Report informs referring to the regulator’s press release.

The Committee voted unanimously for the Bank of England to continue with its existing program of UK government bond purchases, financed by the issuance of central bank reserves, maintaining the target for the stock of these government bond purchases at £875 billion and so the total target stock of asset purchases at £895 billion.

The regulator’s decisions completely coincided with the forecasts of analysts surveyed by the DailyFx website.

The rate has been at 0.1 percent since March 19, 2020. In March, the regulator twice held extraordinary meetings and lowered the rate - first by 50 basis points, to 0.25 percent, and then by 15 basis points, to 0.1 percent.

The MPC will continue to monitor the situation closely.

“If the outlook for inflation weakens, the Committee stands ready to take whatever additional action is necessary to achieve its remit. The Committee does not intend to tighten monetary policy at least until there is clear evidence that significant progress is being made in eliminating spare capacity and achieving the 2% inflation target sustainably,” the regulator wrote.

The outlook for the economy, and particularly the relative movement in demand and supply during the recovery from the pandemic, remains unusually uncertain. It continues to depend on the evolution of the pandemic, measures taken to protect public health, and how households, businesses and financial markets respond to these developments.