The Bank of England’s Monetary Policy Committee (MPC) has decided to keep the interest rate at 0.5% on Friday, May 6. The Council of Mortgage Lenders (CML) announced the decision of MPC as tightening of monetary policy is “some way off”.

However, the report of Bank’s Inflation said that there is a lot of pressure to increase the interest rates.

The CML said that the interest rate may rise in the month of August. The council said that 0.5% interest rate will not help in the growth of the economy and hence the committee may be hold of its tight policy. The members of the committee are trying to lower the risk of inflation and they are also trying to make the economy stronger from last few months.

They further said that demand for the house purchase and mortgage lending market held back due to the pressure on household finances. The demand for the housing market loans decreased in first quarter due to the ambiguity in the market.

According to the data of the Bank of England, it was disclosed that the net price of gross mortgage lending was £11.4bn in March, which is almost up by 22% from February.

The Council added, "The underlying picture shows little variation and remains subdued, with gross lending one per cent lower than a year ago”.