Despite the threat of triple-dip recession the Bank of England held off from further emergency support today.
Interest rates are being held at their record low of 0.5%. The Bank's quantitative easing programme - or the level of money it pumps into the economy - is being maintined at £375 billion.
The Bank of england has voted to keep interest rates on hold at 0.5%
The Bank also left the amount of money it pumps into the economoy - known as quantitative easing - unchanged at £375 billion.
The Bank currently expects the rate of inflation - which increased to 2.6% in July - to fall to the Government's 2% target by the end of this year.
Governor Sir Mervyn King and his colleagues will also want more time to assess the impact of the UK's £80 billion "funding for lending" scheme, which was launched in the summer with the aim of unclogging the flow of credit.
The Bank of England will hold back from prescribing further doses of emergency medicine for the ailing recovery today amid signs the economy will return to growth.
The Bank's Monetary Policy Committee will maintain interest rates at record lows of 0.5% and leave the targeted size of its quantitative easing (QE) programme at £375 billion as the Bank works through £50 billion of asset purchases announced in July.
Most economists think the nine-strong panel will sanction further QE in November and hold their nerve today, a view reinforced by strong services data released earlier this week.
– Ros Altmann, director-general of over-50s group SagaThe Bank of England's policies have been a disaster for savers in general and pensioners in particular. Most of those with savings or pensions have seen their income decimated by policies that have tried to help borrowers and banks, at the expense of those who tried to put money aside for their future. Quantitative Easing (QE) is a massive monetary experiment that has not clearly boosted the economy as intended but instead has boosted inflation and damaged pensions.
– Mark Giddens, partner at UHY Hacker and YoungSavers are losing a staggering amount of money. The onus is very much up to the consumer to do their own leg-work and find the best savings for themselves.
According to research by UHY Hacker and Young:
High levels of inflation, which has been kept higher by the Bank's #325 billion quantitative easing programme - combined with low interest rates on savings and current accounts has caused a severe decline in the value of the nation's savings.
Research from accountancy network UHY Hacker and Young shows that even traditionally higher interest savings accounts such as ISAs are below inflation, at an average of 2.6% interest per year.
The CBI's chief economic adviser, Ian McCafferty, admitted times were tough but insisted the economy was set to pick up.
Over the winter, the economy has been bumping along the bottom, and with the distortions from an extra bank holiday in the second quarter,
is likely to stay that way until summer.
Nevertheless, business surveys suggest that underlying conditions are starting to improve, and that we should see more momentum in the second half of the year.
The CBI has warned that the global economy continues to pose a number of challenges, including worries over the eurozone, high oil prices and fragile household confidence.
It is forecasting that interest rates will remain unchanged over the next year or so, with a rise expected at the end of 2013.