The Bank of England has kept interest rates unchanged for the first time in almost two years on Thursday because “inflation has fallen.”
The bank has also downgraded the outlook for the economy, but officials cannot promise any further rises in the future and will “take the decisions necessary.”
The Monetary Policy Committee (MPC) met on Thursday and this is the first time since November 2021 they have not raised the base rate.
The Office for National Statistics (ONS) said this week that the consumer price index (CPI) inflation had fallen in August.
The ONS revealed that inflation in August was 6.7% which was from 6.8% in July.
The Bank of England Governor Andrew Bailey, voted to keep the rate unchanged he said, “Inflation has fallen a lot in recent months, and we think it will continue to do so.
“That’s welcome news. But there is no room for complacency.
“We need to be sure inflation returns to normal and we continue to take the decisions necessary to do just that.”
Chancellor of the Exchequer Jeremy Hunt said, “We are starting to see the tide turn against high inflation, but we will continue to do what we can to help households struggling with mortgage payments.
“Now is the time to see the job through. We are on track to halve inflation this year and sticking to our plan is the only way to bring interest and mortgage rates down.”