Bank holds base rate at 0.5% with no more QE

The Bank of England's Monetary Policy Committee has held the base rate at 0.5% for the 42nd consecutive month. Quantitative easing also remains at £375bn. Barry Naisbitt, chief economist at Santander UK, said: “The decision to hold rates and quantitative easing came as no real surprise after last month's vote and Inflation Report and the start of the new Funding for Lending scheme. “Attention will now turn to the incoming economic data to see if the economy is showing any signs of recovering from the 0.5% fall in output in the second quarter. “Despite the survey indicators showing a pick-up in service sector activity in August, the general tone of the activity indicators is weak and the UK economy has now seen three successive quarters of falling output. The MPC is likely to continue to watch the economic signs closely to decide whether it will be appropriate to provide a further policy boost by announcing more quantitative easing later this year activity or whether it should hold policy for a longer period." September 7, 2012