MPC is right to stand pat on interest rates

ON UK GROWTH

F&C's Peter Lees believes the BoE's lack of action on interest rates has prevented jeopardising the economy further.

Earthquake and tsunami in Japan, revolution in the MENA region and sovereign debt issues in Europe all contributed to an extraordinary Q1. The market has proved resilient and the sell-off was no more than a healthy correction to the bull market. The UK economy continues to struggle amid the austerity measures and the coincidental rise in inflation has had a depressing effect on consumer confidence. The weak economy means the BoE faces a difficult dilemma. While the MPC would not want to add to the misery of the household sector, not only is inflation way above its target but higher in...