The Bank of England’s Monetary Policy Committee has announced it will maintain Bank Base Rate at 0.25%, in February.

The rate has been at 0.25% since August 2016 when it was cut from its long-standing level of 0.5%.

The Bank of England has increased its expectation for economic growth in 2017 to 2.0% and expects growth of 1.6% in 2018 and 1.7% in 2019. It noted that ‘domestic demand has been stronger than expected over the past few months, and there have been relatively few signs of the slowdown in consumer spending that the Committee had anticipated following the referendum’.

But it warned of weaker household incomes over the next few years as a result of a slowdown in pay growth and  higher import prices. ‘As a consequence, real consumer spending is likely to slow’ said the Bank.

Ian Kernohan, economist at Royal London Asset Management, said that it was unlikely Base Rate would rise in the coming months: “With higher inflation set to squeeze household incomes this year, and the likely shape of the UK’s trading arrangements post-Brexit still very unclear, the MPC will be reluctant to add to these pressures on the economy by raising interest rates in the near future.”