Experts predict that at the upcoming Bank of England Monetary Policy Committee (MPC) meeting members will maintain the interest rate at 4.5 per cent.
Speculation has been rife over what the MPC will decide given disappointing economic data including slumped consumer spending and economic growth at a 12 year low.
Speaking to AFX, Geoff Dicks, an economist at Royal Bank of Scotland, said: “With City economists fully lined up behind unchanged rates, a move this month is scarcely imaginable.”
This opinion is echoed by Nationwide Building Society which said in a statement that despite inflation rising to 2.4 per cent it “forecasts an 80 per cent probability that the MPC will once again hold rates at 4.5 per cent”.
Many analysts think that if any change in interest rates is imminent then the decision will be taken at the November meeting of the MPC, following a closer examination of the economic effects of household inflation and high oil prices.
John Butler, an economist at HSBC, told AFX: “For now the MPC is closely monitoring the issue and while they await the economic implications it is a reason to delay the next move in rates.”
© Adfero Ltd