14 Jan 2011

Bank of England, ECB hold interest rates

8:58 am on 14 January 2011

The Bank of England has kept interest rates in Britain on hold at 0.5%, and announced no new quantitative easing measures.

The BBC reports both decisions were expected. QE is the Bank's policy of putting new money into the financial system to try to stimulate the economy.

The bank's key interest rate has been at 0.5% since March 2009.

Also on Thursday, the European Central Bank kept interest rates on hold at 1% for the 20th consecutive month.

ECB president Jean-Claude Trichet said there was "evidence of short-term upward pressure on overall inflation, mainly owing to [rising] energy prices".

The BBC reports the bank's inflation target is to keep price rises below, but close, to 2%. Inflation in the eurozone is currently 2.2%.