Interest rate frozen

The Bank of England's monetary policy committee (MPC) has decided to maintain the rate of interest at 0.5 per cent.

Between the summer of 2007 and March this year, the rate dropped from 5.75 per cent to its current level, bringing the cost of borrowing to a record low point.

However, it has been widely predicted that the MPC will choose to keep it at 0.5 per cent for the remainder of the year.

In a statement accompanying the base rate announcement yesterday, the Bank gave an indication that the speed of the financial crisis is starting to slow.

It said: "In the United Kingdom, GDP fell sharply in the first quarter of 2009. But surveys at home and abroad show promising signs that the pace of decline has begun to moderate."

The Bank started issuing a general economic update alongside its monthly interest rate decision after the extent of the global financial markets decline became clear last year.