No change in base rate expected this month, says expert

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No change in base rate expected this month, says expert

Fri 7th May 2010

The Bank of Englandbase interest rate is not likely to change this month, according to one sector commentator, who highlighted several issues that will have contributed to this situation.

Alan Clarke, UK economist at BNP Paribas, pointed out that the Monetary Policy Committee (MPC) will not know the implications of the recent election by Monday - something that he feels will take at least a month to work out.

As a result, he feels that the MPC will do "absolutely nothing".

Mr Clarke's remarks were made regarding the next interest rate decision, which is due to be made on Monday May 10th, after the committee voted to keep it at 0.5 per cent in April.

He went on to predict that the base rate will not be increased until August at the earliest.

"[I suspect] that the Bank of England will leave interest rates on hold for the whole of this year and probably next. I don't see a lot of action any time soon," suggested the BNP Paribas representative.

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