The Bank of England Monetary Policy Committee (MPC) chose to keep base rate on hold at 0.5%, as economic recovery remains fragile.
As widely expected, MPC members ignored calls from organisations including the Save Our Savers group to hike rates, despite soaring inflation, which is more than 2% above the official target.
With signs that the economy is still on shaky ground, the earliest that economists are now predicting a rate rise is November. However, increasing numbers of forecasters are mooting there will be no shift until at least 2012, with financial money markets now pricing in a rate rise for March 2012.
The MPC has previously said it expects inflation to fall next year when the impact of the VAT rise is stripped out.
We saw an increase in the number of sales agreed last month. However, we are not seeing any significant signs of improvement in the volume of transactions, as consumer confidence continue to suffer further setbacks with the collapse of well-known retailers.
These are positive signs for borrowers who want to remortgage whilst lenders are offering these competitive rates before rate rises become much more of a reality and lending rates begin to increase.
