LONDON, April 10 The Bank of England kept
interest rates unchanged at a record-low 0.5 percent on
Thursday, as expected, as it waits for Britain's economy to
recover fully from the financial crisis.
None of the 61 economists polled by Reuters before the
decision had expected a change, and most think a rise in
interest rates is still around a year away.
The BoE also said it would maintain the stock of asset
purchases from its quantitative easing programme at 375 billion
pounds ($628 billion), in line with a previous commitment not to
reduce them until some time after it starts raising rates.
Unemployment remains slightly above the 7 percent level the
central bank set in August as a threshold for beginning to
consider raising rates. In February it added that it expected to
keep rates on hold for some time after that.
Despite strong growth over the past year and the best growth
prospects for 2014 among any big advanced economy, British
output is still below its pre-crisis peak, lagging behind the
United States and Germany, which both recovered faster.
Meanwhile consumer price inflation remains muted. It fell to
a four-year low of 1.7 percent in February, comfortably below
the BoE's 2 percent target, and retailers have reported they cut
prices in March.
House prices are rising fast, at an annual rate of more than
10 percent, but the central bank has yet to show much alarm. It
has also said it will target mortgage lending directly before
raising interest rates for the whole economy if house price
rises threaten to get out of control.
BoE Governor Mark Carney said in February that the central
bank could take its time raising interest rates, and wait for
sustainable increases in employment, income and spending before
tightening monetary policy.
($1 = 0.5971 British Pounds)
(Reporting by David Milliken Editing by Jeremy Gaunt)