# Interest rate hold signals confidence in UK economy  Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2016-11-09 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: Bank of England Holds Interest Rates at 0.25% - Cautious Meta Description: Discover why the Bank of England has maintained interest rates at 0.25% and what this signals for the UK economy post-Brexit. Read more here. URL: https://financedigest.com/interest-rate-hold-signals-confidence-in-uk-economyhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/offers-hand-shakezjpfo9hu-1736844398378-compressed.jpg) - **Bank of England holds interest rates at 0.25%** - **Interest rate hold signals cautious confidence in UK economy (easyMarkets)** - **UK manufacturing on a ‘firm footing’ (Markit)** - **Economy grew by 0.5% in Q3 2016 (ONS)** Consumers were today denied an early Christmas present in the form of another interest rate cut when the [Bank of England announced that it will be holding](https://www.financedigest.com/polish-central-bank-holds-rates-points-to-slowdown-ahead.html "Polish central bank holds rates, points to slowdown ahead") rates at the current level of 0.25%. Experts had been divided about whether a further [cut would follow the slashing of rates](https://www.financedigest.com/czech-central-bank-vice-gov-unlikely-to-vote-for-rate-cut-newspaper.html "Czech central bank vice-gov unlikely to vote for rate cut -newspaper") from 0.5% to 0.25% in August 2016, which saw interest rates reach a record low following the first cut since 2009. ![Evdokia Pitsillidou](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/evdokiapitsillidou-1736844398280-compressed.jpg) Evdokia Pitsillidou **Evdokia Pitsillidou, Risk Management Associate** at pioneering forex and CFD broker [**easyMarkets**](http://r20.rs6.net/tn.jsp?f=001Ypv8Vrh2Fjs7i2JLBgOkrWCyaNTMGiFIoyKbWdjeNpzycPLu7IPyKc9xyTX38p3_-qq_V9EVmWWuZq3ibVax_b5CMSGygEVLVfGw-MHigZ0xggKeC1cMvjCpIdXr5hifjpxRQ1PS2ZSpzGjoC2ave-2nQ0TFUHUiIWzzXOC80YQWQwOiWEUFZg==&c=WIyurC3BZA_nkY0pClEjGpdULNjCKYGBe5zZ92DFSrYHt4Jy6An3Dg==&ch=3OOYh6aNUKRbs9B0UyUj9-Nfx1VSbayMf3NyDnI81O97bILTWS5CoA==), comments, While many consumers will be disappointed that another interest [rate cut](https://www.financedigest.com/ecb-policymakers-back-jumbo-rate-hike-differ-on-balance-sheet-cut.html "ECB policymakers back jumbo rate hike, differ on balance sheet cut") hasn’t been announced, the move signals cautious confidence in the UK economy, which is important in this post-Brexit-vote era. Interest rates are already at [record lows and the fact that the Bank](https://www.financedigest.com/credit-suisse-shares-hit-record-low-after-report-bank-is-looking-to-raise-cash.html "Credit Suisse shares hit record low after report bank is looking to raise cash") of England’s Monetary Policy Committee didn’t see the need to drop rates any further might be viewed in a positive light. There’s a [fine balance](https://www.financedigest.com/theres-a-fine-line-between-relinquishing-control-and-accountability-financial-institutions-must-balance-both-to-successfully-cloudify-operations-and-meet-customer-expectations.html "There’s a fine line between relinquishing control and accountability. Financial institutions must balance both to successfully cloudify operations and meet customer expectations") going on at present between the weakened pound and the strength of the economy in light of so many unknown factors. Although rates haven’t been cut now, the Bank of England may still decide to do so at the [Monetary Policy](https://www.financedigest.com/asian-economic-powers-warn-of-risks-from-war-monetary-policy-normalisation.html "Asian economic powers warn of risks from war, monetary policy normalisation") Committee meeting on 15 December – so we could still see a lower rate before the end of 2016. Since the Brexit referendum at the [end of June](https://www.financedigest.com/covid-hit-shanghai-to-end-two-month-lockdown-on-june-1.html "COVID-hit Shanghai to end two-month lockdown on June 1"), when the UK decided to withdraw from the European Union, economic headlines have been largely positive. Sterling’s value has plummeted, which has [boosted the country’s manufacturing sector and encouraged a horde of overseas investors](https://www.financedigest.com/aviva-boosts-investor-payouts-after-profit-beat.html "Aviva boosts investor payouts after profit beat") to put their money into the UK property market. The [latest Markit/CIPS purchasing managers’ index has confirmed that UK manufacturing remains on a “firm footing,” with exports rising](https://www.financedigest.com/car-bulb-market-demand-supply-growth-factors-latest-rising-trend-and-forecast-to-2028.html "Car Bulb Market Demand, Supply, Growth Factors, Latest Rising Trend and Forecast to 2028"), although import costs were also reported to be rising by some 90% of manufacturers. Markit Economist Rob Dosbson observes, Despite slowing from September’s highs, [growth of output and new orders continued](https://www.financedigest.com/impact-com-announces-continued-growth-in-first-quarter-of-2022.html "impact.com Announces Continued Growth in First Quarter of 2022") to defy expectations, rising at marked rates and supporting the fastest job creation in a year. Figures from the Office for National Statistics also show that the UK’s economy has [continued to grow](https://www.financedigest.com/continuous-innovations-and-growing-urbanization-to-amplify-sales-of-privacy-screens-market-fact-mr-report.html "Continuous Innovations and Growing Urbanization to Amplify Sales of Privacy Screens Market: Fact.MR Report") in the wake of the Brexit vote. The economy expanded by 0.5% in Q3 2016, with an ONS spokesperson commenting, “There is little evidence of a pronounced effect in the immediate aftermath of the vote.” The [services sector](https://www.financedigest.com/the-state-of-cybersecurity-in-todays-financial-services-sector.html "The state of cybersecurity in today’s financial services sector") was largely to thank for the growth, with Chancellor Philip Hammond announcing his pleasure that the economy is, “still resilient. [Bank of England governor](https://www.financedigest.com/czech-interest-rates-already-at-high-level-central-bank-governor-says.html "Czech interest rates already at high level, central bank governor says") Mark Carney’s commitment to remain in post until June 2019 has given a further boost to confidence in the UK’s financial climate, with the City largely welcoming his decision to remain for a year more than he had originally committed to. [Prime Minister](https://www.financedigest.com/factbox-who-will-replace-uk-prime-minister-boris-johnson.html "Factbox-Who will replace UK Prime Minister Boris Johnson?") Theresa May was also appreciative, acknowledging the importance of, “continuity and stability as we negotiate our exit from the European Union. There’s a long journey ahead,” concludes **easyMarkets’ Evdokia Pitsillidou**, “But right now the UK [economy is proving a lot stronger than many experts feared](https://www.financedigest.com/stocks-sink-on-fears-for-global-economy-capping-worst-h1-on-record.html "Stocks sink on fears for global economy, capping worst H1 on record") it would. We’re heading towards 2017 with a far more [resilient economy](https://www.financedigest.com/stocks-dollar-gain-on-resilient-u-s-economy.html "Stocks, dollar gain on resilient U.S. economy") than we thought we would be in the immediate aftermath of the Brexit referendum --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---