The Bank of England left the base rate at 0.5% once again. It has been at that "record low" level since March 2009 - that length of time at one interest rate may be a record in itself!
Most economists do not expect the rate to be changed this year, but many do expect there to be a rise in 2012 - to 1.5% by the end of the year. Pure speculation, I'd say. I don't believe any so-called experts foresaw the economic crash of 2008-9, nor expected the interest rate to tumble to 0.5% when it did. Few of them know what surprises are around the next corner.
For people with mortgages, the continuing low rate should continue to be good news, but for savers the low interest rate means that their savings are dwindling in value - especially with inflation at around 4%.
We are encouraged to save - at least in words - by politicians, but the hard monetary facts enourage us to do otherwise. It is still better to borrow than to save.
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