Interest
rates for July 2012 were held at there record low of 0.5% by The Bank of
England's Monetary Policy Committee (MPC).
Economists
had expected no move in rates because the latest data has shown the UK economic
recovery remains weak.
The
committee's decision comes despite the annual rate of inflation remaining at
4.5% in May, well above the Bank's 2% target.
The Bank
also kept its programme of quantitative easing unchanged at £200bn.
The MPC is
split over which is the greater problem, the weak economy, which recent data
suggests has slowed from the 0.5% growth of the first quarter, or inflation,
which is squeezing consumers' purchasing power.
The
National Institute for Economic and Social Research's latest forecast suggests
the UK economy barely grew in the second quarter of year.
It
predicts growth of 0.1%, below other recent estimates which predict a rise of
0.3%.
