Bank of England Rate Changes

Net lending to individuals increased by just £0.9bn in March, lower than both February’s increase and the six-month average, according to Bank of England figures.

This was also the case with the increase in net lending secured on dwellings (£0.8bn), which also fell below the jumps of the preceding month and the six-month average.

The 12-month growth rate fell further, by 0.4% to 2%, while the three-month annualised growth rate fell by 0.4% to 1.0%.

However, the number of loans approved for house purchase (39,230) was higher than in February and higher than the previous six-month average, while approvals for remortgaging (31,746) were higher than in February, but below the previous six-month average.

The Bank of England Monetary Policy Committee MPC voted to keep the Bank of England rate at 0.5% in April.

Interest rates are set by the Bank’s Monetary Policy Committee. The MPC sets an interest rate it judges will enable the inflation target to be met.

The Bank’s Monetary Policy Committee (MPC) is made up of nine members – the Governor, the two Deputy Governors, the Bank’s Chief Economist, the Executive Director for Markets and four external members appointed directly by the Chancellor. The appointment of external members is designed to ensure that the MPC benefits from thinking and expertise in addition to that gained inside the Bank of England.

Members serve fixed terms after which they may be replaced or
re-appointed. The current members are:

Mervyn King, Governor
Charles Bean, Deputy Governor
Paul Tucker, Deputy Governor
Kate Barker
Tim Besley
Prof. David Blanchflower
Spencer Dale
Paul Fisher
Andrew Sentance