Bank of England keeps interest rates at 0.1%, warns rising COVID-19 infections could threaten economic recovery

Health concerns would continue to drag on the economy’s ability to rebound from the Coronavirus lockdown and there was still the prospect of a steep rise in unemployment, the bank’s monetary policy committee (MPC) said.

The Bank of England has decided to keep its main interest rate “unchanged” at the record low of 0.1 percent as it measures the strength of the economy’s recovery from recession and what the United Kingdom’s future relationship with the European Union will be.

Health concerns would continue to drag on the economy’s ability to rebound from the Coronavirus lockdown and there was still the prospect of a steep rise in unemployment, the bank’s monetary policy committee (MPC) said in its report, adding the outlook for the economy remains “unusually uncertain” in light of the recent spike in COVID-19 infections.

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However, the committee noted that recent domestic economic indicators have been a little stronger than expected.

It must be mentioned here that the British economy suffered one of the deepest recessions in the world this year.