Interest rates held at 0.5%

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The Bank's decision - which was outlined in its quarterly inflation report - will come as no surprise to the City, which expected Threadneedle Street to ditch plans for tighter policy this month in the light of first quarter growth of 0.1%, a faster-than-expected fall in inflation and evidence that consumers were cutting back on spending.

"At the moment, inflation is higher and there´s no major risk-off factors, with even the US exit from the Iran nuclear deal having a minor impact".

Despite predictions of an uplift, interest rates have been kept on hold at 0.5%.

"With the latest Inflation Report showing pricing pressures tailing off - inflation is expected to be just 2.1% this time next year and to hit the 2.0% target by 2020 - rate-setters have kicked the interest rate can down the road once more".

Since he joined the BoE in 2013, Carney has signaled several times that the time was nearing for rates to rise from the historic low of 0.5 percent they reached during the 2008-09 financial crisis, only for economic data to go the wrong way.

Revealing a glimmer amid the gloom for British household finances, the Bank said that high inflation would abate sooner than previously thought.

The BoE predicted that consumer price inflation (CPI) would continue to fall, approaching the target figure of 2 percent.

BoE governor Mark Carney suggested in April that the central bank might not raise rates in May because of the mixed economic data, causing a sharp reversal in bets on a May hike.

Personally I think we might not see a rate rise for the rest of the year.

The 2018 GDP forecast has been lowered from 1.7% to 1.4% from February's inflation report, while also cutting its wage growth outlook for this year from 3% to 2.75%. On the macroeconomic front, United States producer price data was soft, slipping to 2.6% year-on-year versus the 2.8% consensus, but had minimal effect on the market.

Just a month ago a rate hike to 0.75% seemed a near certainty, but poor United Kingdom economic data all but killed the chance of rates increasing.

The inflation rates of the most import-intensive components of the CPI appear to have peaked.

LONDON - The Bank of England on Thursday left interest rates unchanged at 0.5%, as had been widely expected by markets and commentators alike.

The BOE continued to see an output gap of -0.25% in Q2 rising to zero thereafter, which means it sees the economy underperforming its potential marginally in Q2 before fulfilling potential after.

Craig McKinlay, sales and marketing director at Kensington Mortgages, added: "Only until recently did a rate rise feel inevitable in May, and it is likely many borrowers will feel relieved by today's news".

"Where we can hope to see greater certainty later in the year is through positive progress in Brexit negotiations, which can lend some much-needed stability to business confidence and the United Kingdom economy as a whole".

Unfortunately for Pound (GBP) traders, the next high-impact United Kingdom economic data could cause further losses against the Rand (ZAR).

If the rest of May and June brings strong United Kingdom data releases, the Pound may progressively rise on hopes for an interest rate hike on 21 June.

He said the move was likely to take place in August "highlighting how policymakers believe the recent weak start to 2018 to have been a temporary soft patch, linked mainly to heavy snowfall".