MPC decision 'no big shock'

The decision of the Monetary Policy Committee (MPC) to retain the 0.5% base rate is unsurprising considering that a general election is only around the corner, according to one expert.

Robert Sinclair, director of Association of the Mortgage Intermediaries, stated that as the economic recovery remains weak, further quantitative easing may still be required.

There is little evidence to sustain an increase in the rate as house prices are recovering and inflation is starting to peak, he added.

Mr Sinclair believes that an extended period at the current level - it is already in its twelfth month - can be expected to facilitate an improvement in the financial situation.

The organisation hopes to play a "constructive role" within the mortgage regulation process.

It was recently revealed by the Royal Institute of Chartered Surveyors' European Housing Review that the market had managed to avoid a meltdown during the recession, with the downturn a lot shallower than expected.