BoE to freeze low lending rate

The Bank of England yesterday said its policymakers recently voted unanimously in favour of freezing its key lending rate at a record low level of 0.5 per cent amid Britain's longest recession.

The BoE's Monetary Policy Committee was also unanimous in deciding to continue pumping out up to £200 billion of new money, minutes of their last meeting showed.

The Bank of England has sought to combat recession with a record-low interest rate of 0.5 per cent and a radical policy of quantitative easing - pumping new cash into the economy to help kick-start lending.

"The committee voted unanimously in favour of" maintaining the level of its key interest rate and QE, the BoE said in minutes of its December 9-10 meeting published yesterday.

The BoE's main task is to try and use monetary policy to keep annual British inflation close to a British government-set target of two per cent.

Twelve-month inflation jumped to 1.9 per cent in November owing to rising fuel prices, recent official data showed.

In a bid to lift Britain out of recession, the BoE in March slashed British borrowing costs to their record low level and launched the QE policy, whereby it creates money by purchasing bonds from commercial institutions.