The Bank of England’s Monetary Policy Committee (MPC), met once more, as they do every month, to discuss the standard base interest rate and the state of the economy.  The standard base interest rate has been left at the low historical rate of 0.5%.  It has stayed steady since March 2009.  On November 12, the Bank will publish the UK economic projections which will likely be less optimistic than most would have hoped for the closing of 2014.  The UK economy has slowed but it is still closer to recovery than most global economies.

There are many factors that are coming together and putting a strain on the forecast for the economy.  The euro zone could be facing a recession as Germany, the largest economy in Europe is facing economic problems.  The UK inflation level is expected to fall below 1.0% and job and wage growth have been slow. 

When the housing market had strong growth only months ago, there were warnings of an interest rate hike as early as the end of the year and then later, warnings moved to the beginning of 2015 for costlier borrowing.  Now, with all factors staying the same and optimism for the first quarter of the new year, the interest rate may not begin to move upward until mid-2015.

The minutes from the past few MPC meetings have revealed that a few members have voted for a rate increase of 0.25% to the standard base rate but that may have changed with the different tone and outlook having descended upon the committee in this month’s meeting.  The minutes for this month’s MPC meeting will be made public in two weeks.