Bank of England in wait and see mode

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Howard Archer, chief UK and European economist at analyst firm Global Insight, advises that the Bank of England is still in "wait and see" mode.

The comments came as the nine members of the banks monetary policy committee voted in their September meeting to maintain the current base rate of 5.75 per cent.

Mr Archer predicts that it is "highly likely" rates will remain unchanged until at least November as the full affordability impacts of previous rises are assessed.

"There is currently no clear economic case for a further rise in interest rates," he asserts.

"Nevertheless, the strength of the August service sector and manufacturing surveys highlight the fact that there is still a distinct possibility that interest rates could eventually reach six per cent."

While Mr Archer observes that the housing market remains "resilient", he adds that it may have reached its peak as homeowners look to rein in their spending.

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