Interest rates on hold for 21st consecutive month

The Bank of England base rate ended the year as it started, stuck on 0.5%, as the Monetary Policy Committee (MPC) met for the last time in 2010 today.

For the 21st consecutive month the MPC chose to leave interest rates unchanged. In addition, the Bank decided to maintain its quantitative easing programme at £200 billion.

Concerns about inflation hitting 3.2% in October, well above the Bank's long-term target of 2%, took a back seat as the Committee chose not to shake up what is still considered to be a shaky recovery.

It is expected divisions within the MPC echoed those of previous months, with Andrew Sentance and Adam Posen sticking to their earlier positions.

Sentance has been pushing for interest rates to be hiked for a number of months, while Posen has been advocating the opposite tactic of extending quantitative easing.

Minutes of the meeting which will detail the breakdown of the vote will not be released for another couple of weeks.

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