Bank of England leaves interest rates on hold
LONDON (AP) — The Bank of England left its key rate on hold Thursday at the record low of 0.5 percent as concerns over Britain's sluggish economic recovery outweighed inflation concerns.
Figures last month showed an unexpected drop in inflation in Britain in June to 4.2 percent, which reinforced expectations that the central bank would keep interest rates low for months to come.
The Bank of England has largely justified its decision to keep its main interest rate at 0.5 percent on the assumption that inflation will likely fall back toward the official 2 percent target next year. Interest rates have been unchanged since March 2009.
The central bank also voted to leave the size of its asset purchase program unchanged despite calls from some observers, including business secretary Vince Cable, for the Bank of England to revive its economic stimulus program of "quantitative easing.
The program pumped 200 billion pounds ($327 billion) into the economy through asset purchases in 2009.
The Bank of England will publish its latest quarterly inflation and growth forecasts next week.