The Bank of England has held interest rates today at 5.75% ending five consecutive rises since August last year.

The Monetary Policy Committee is thought to have reacted to a positive situation which has seen inflation fall below the government’s 2% target for the first time in one and a half years to 1.9% and the global credit crunch and US sub prime crisis which has increased the cost of money.

The rate is expected to remain at this level for the rest of the year although there was still considered to be inflationary pressure in the economy. The government said wage inflation has settled to 3.3% which is its lowest level in four years and house price rises have stabilised.

Interest rates in the Eurozone have also stayed at 4% today with the European Central Bank stating that it was ‘ready to contribute to orderly conditions in the euro money market.’