Bank Of England Holds Interest Rate For 4th Consecutive Month

London, England (AHN) - The Bank of England retained the 5 percent interest rate on Thursday for the fourth straight month. Bank officials said they opted to keep the rates untouched to avert a rise of inflation rate to 5 percent.

Economist expected the bank's move as a rate increase will lead the ailing British economy into a deeper downturn, while a rate reduction indicates it has less worry over inflation, even if the last inflation rate of 3.8 percent exceeded its 2 percent target.

The decision was a let down for homeowners and businesses who were hoping for a cut in their mortgage cost, fuel prices, food and energy bills. Economic experts forecast the Bank of England will likely hold on to the same rate until December and bring down borrowing cost only next year.

Hetal Mehta, senior economic adviser to the Ernst and Young ITEM Club explained to the U.K. Telegraph, "Although its reputation is built on its inflation-fighting ability, the Bank has so far resisted the temptation to hike interest rate while the economy experiences its most significant slowdown since the early 1990s... The Bank is no doubt aware that a rate hike at this time is likely to push the economy into a recession."