As expected, the Bank of England's Monetary Policy Committee (MPC) has left the bank rate unchanged at 0.5 per cent.
 
No further statement was made about Quantitative Easing. The current programme of £200 billion is expected to be complete by February.
 
Edward Menashy, chief economist of Charles Stanley, said, 'Whilst the press has been full of reports about fears of sovereign debt crises and 10 year gilt yields have risen to just over 4 per cent, the fixed interest market remains relatively calm.

'There seem to be no signs yet of a reluctance of investors to subscribe for new gilts, as evidenced by the fact that yesterday’s auction for 2.75 per cent 2015 was well covered.'
 
He added, 'Concerns will continue however over whether the Government’s plan for debt reduction is credible. In these circumstances, we still like the shorter-dated index-linked gilts and also the shorter-dated good quality corporate bonds.'