Bank of England keeps main interest rate unchanged at 4.75%

The country’s economy has now contracted for two consecutive months.

“Headline CPI inflation is expected to continue to rise slightly in the near term. Although household inflation expectations have largely normalised, some indicators have increased recently,” the central bank said in a release.

The central bank's inflation target is 2 per cent. With little indication of inflation getting back to the target anytime soon, the MPC, which last cut its key rate in November, took a cautious stance as lower borrowing rates could stoke inflation.

ALCHEMPro News Desk (DS)