The Committee also voted to maintain the stock of purchased assets financed by the issuance of central bank reserves at £375 billion.
The full minutes will be published on Wednesday 22 April.
Nick Dixon, Investment Director at Aegon UK, commented:
“A second general election is more likely to occur before the next rate rise with expectations of a rise constantly nudged back by economic headwinds. Recent MPC commentary has indicated that the extent of the deflation risk facing the country is currently dominating discussion. These discussions are pushing the notion of a rate rise to the back of the queue.”
Barry Naisbitt, Chief Economist, Santander UK, added:
"The Monetary Policy Committee once again decided to hold Bank Rate today. This was not a surprise. The decision to hold rates in March was unanimous and in advance of today’s meeting it seemed most unlikely that the economic news and data over the past month would have been sufficient to support a change in view for the majority of MPC members.
"The latest indicators of economic activity have continued to show steady growth, with the PMI output indicators positive in the first quarter of the year, with services showing an unexpectedly large boost in March, and the unemployment rate has fallen to 5.7%. The effect of falling oil prices is clearly being seen in CPI inflation, which was at a low of zero percent in February and could go slightly negative in the coming months. This exceptionally low inflation should provide scope for the MPC to continue to hold rates at their current level."
Stephen Smith, Director, Legal & General Mortgage Club and Housing, commented:
“No one will be surprised by the Monetary Policy Committee’s decision to keep interest rates at 0.5%. With inflation at 0%, the lowest it has ever been, interest rates are likely to remain at their current levels for the remainder of this year.
“It is easy for homeowners to think that as the bank rate hasn’t moved that the rates that banks offer to consumers won’t have changed either. However, this is not the case. Banks don’t just look at the base rate when deciding the rates they offer to consumers, they also look at swap rates which can be very volatile. The average rate offered on a two fix over the past three years has fluctuated by 1.4% and the average 5 year fix has moved by 1.3% in the same period. At the moment there are some very competitive deals around and anyone who is thinking about moving house or who is coming to the end of a mortgage deal should speak to a broker now about which deal would be right for them. Those who wait until interest rates start to rise risk missing out on the best deals as bank will raise their rates long before the Bank of England makes an announcement.”
