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Bank rate held at 0.5% for 29th month

The Bank of England monetary policy committee held bank rate at 0.5 per cent for the 29th month in a row last week and kept quantitative easing at £200bn.

The last rate change was on March 5, 2009, when it was reduced from 1 per cent to 0.5 per cent. On the same day, the Bank of England initiated a £75bn QE programme.

The most recent change to the size of the programme, on November 5, 2009, was an increase of £25bn, bringing the total to £200bn.

Last week, the European Central Bank held its main interest rate at 1.5 per cent. The ECB raised rates in April and July by 25 basis points on both occasions.

Norwich & Peterborough mortgage manager Richard Barker says: “The decision to leave the base rate unchanged at 0.5 per cent was widely anticipated across the industry. Many economists believe rates will remain on hold for the rest of the year, so for the moment, those on a variable rate, or tracker have more time to consider their options.”

The July minutes show the committee voted 7-2 in favour of keeping rates at 0.5 per cent.



Advisers want service pledge in Friends open and shut split

Advisers have called on the FSA to ensure Friends Life maintains equal service standards in its open and closed book arms amid fears that service levels will fall in the closed operation. Last week, revealed Resolution plans to split Friends Life into an open front book and a closed back book. Friends Life executive […]


George Osborne to address Parliament over economic situation

Chancellor George Osborne is to make a statement to the House of Commons on Thursday about the current economic situation. The move comes amid volatile financial markets and a European debt crisis. Osborne will outline the UK’s view on the economy and take questions from MPs. Speaking to Money Marketing, Shadow Treasury financial secretary Chris […]

IFP calls for Government to pay for simple advice

The Institute of Financial Planning says simplified advice could be delivered through a NHS-style framework where the Government pays or contributes to the costs of mass market advice. IFP chief executive Nick Cann put forward the idea last week in a webcast on simplified advice. He believes a simplified advice solution should see the Government […]

Repossessions down 7% year-on-year

The number of properties taken into possession in the first half of 2011 was 7 per cent lower than in the first half of 2010, according to the Council of Mortgage Lenders. There were 18,100 repossessions in the first half of the year, compared to 19,500 over the same period last year. The total number […]

Simon Fletcher

Auto-enrolment: pay attention or pay the price

By Simon Fletcher

As a chief executive officer of a business in the financial services sector, I have been dealing with the introduction of auto-enrolment for our clients for some time, but I can also speak from an employer’s point of view, having to go through the process ourselves.


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