Bank of England keeps policy rate at 0.5 pct

By Gokhan Kurtaran

LONDON (AA) – The Bank of England has kept its policy rate at 0.50 percent and maintained the stock of corporate and U.K. government bond purchases, it said on Thursday.

The bank's Monetary Policy Committee voted by a majority of 7-2 to maintain the policy rate, according to a statement.

Committee members Ian McCafferty and Michael Saunders voted for an increase in rates to 0.75 percent.

Considering that the committee voted unanimously at the last meeting, the two votes in favor of a hike might be interpreted as a change in policy direction in May.

The committee also voted unanimously to maintain the stock of U.K. government bond purchases, financed by the issuance of central bank reserves, at 435 billion British pounds ($613.83 billion).

The bank had hiked the rates to 0.5% last November, the first increase in a decade.

“The prospects for global GDP growth remain strong, and financial conditions continue to be accommodative, with little persistent effect from the recent financial market volatility,” said the minutes of the committee meeting.