The Monetary Policy Committee at the Bank of England voted unanimously to maintain base rate at 0.1% following its June meeting.

In its report the Committee said that UK GDP was ‘expected to recover strongly over 2021, to pre-Covid-19 (Covid) levels’.

The report added that the recovery has been ‘most pronounced in the consumer-facing services for which restrictions were loosened in April’. It added that the housing market remains strong, and indicators of consumer confidence have increased.

Inflation is projected to rise temporarily above the 2% target, before returning to around 2% in the medium term.

Low interest rates look set to stay as the Bank of England said it ‘does not intend to tighten monetary policy at least until there is clear evidence that significant progress is being made in eliminating spare capacity and achieving the 2% inflation target sustainably’.

The Monetary Policy Committee will meet again in August.