The Bank of England (BoE) Monetary Policy Committee (MPC) last week decided to hold the BoE interest base rate at 3.5% after cutting it by a quarter percent last month.
Releasing its decision, the MPC gave no indication of its reasoning but said: ‘Minutes of the meeting will be published at 9.30am on Wednesday 20 August.’
The decision was not unexpected, although Laurence Sanders, economist at lender Bristol & West said he expected decisions in the coming months may be more finely balanced, with arguments for both cuts and increases, likely to be coming to the fore. However he added: ‘We forecast that base rates will remain on hold for the rest of the year, before a 0.25% increase in February or March with base rates rising slowly to 4.5% by the end of 2004.
‘The low interest rate climate will continue to support the housing market with average house prices returning towards trend growth ‘ around 7% by the end of the year. This represents a soft landing for the housing market, which will be welcomed by both lenders and government policymakers.’