05 March 1998
Interest rates held at 7.25%
By FWi staff
INTEREST rates are to remain pegged at 7.25%, the Bank of England has decided.
Officials at the Banks Monetary Policy Committee monthly meeting today (5 March 1998) decided that increasing interest rates would make exports less competitive.
A minority of analysts had expected rates to be increased to prevent the boom in the service sector from fuelling inflation. But that turned out to be wrong.
An interest rate increase in the coming months cannot yet be ruled out, however. The Bank is understood to be considering such a move, but is concerned that raising rates could be detrimental to the economy unless absolutely necessary.