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Interest rates held as expected

Interest rates will go into the new year held at 6%, after the Bank of England Monetary Policy Committee voted to hold them at their present level for the 10th month in a row.

And there now seems to be mounting support for a cut in the rates. Recent reports have shown both the U.S. and U.K. economies to be slowing down and British inflation has for some time remained below the government's 2.5 percent target rate. Ian Peters of the British Chambers of Commerce that "Business will be looking for an early cut in rates in the New Year. Manufacturers remain under severe pressure from the weak euro and are being forced to squeeze profits and scale back investment plans in order to compete."

However, with Bloomberg quoting Sterling at a four month low against the Euro - the weakest since July 27th, it seems unlikely that the committee would cut rates solely to boost exports.

The minutes of the committee meeting will be published at 9.30am on Wednesday 20 December.