Homeowners will be pleased to hear that the Bank of England and the Monetary Policy Committee have decided to keep the base interest rate on hold at its all time low for yet another month. This will mark the nineteenth month in a row that the base interest rate has been at its lowest level in the history of the Bank of England, which is 0.5 percent.

For homeowners who are on variable rate mortgage this will help to ensure that they can continue making lower repayments, thus avoiding the risk of being unable to afford their mortgage repayments. The move will also be welcomed by many industry groups, who are keen to see the base rate remain at its record low for the foreseeable future.

The decision to keep the base rate on hold has not come as any great surprise to most industry officials, as most had not expected the MPC to put the base rate up because of the continued fragility of the UK economy. This is despite the fact that one MPC member has voted to increase the base rate for the past four months in order to try and keep a lid on rising inflation.

At present inflation stands at 3.1 percent, which is far higher than the 2 percent target set by the government. However, the Bank of England believes that at present it is more important to stimulate spending and ensure the security of the economy by keeping interest rates low than increasing the base rate and focussing on inflation, which it believes will start to come down in due course.

The central bank also announced that there would be no extension of the quantitative easing scheme that was launched by the former Labour government, and through which £200 billion has already been ploughed into the economy.