Bank of England once again holds rates on hold as fight against inflation continues

By Aysu Bicer

LONDON (AA) - In line with market expectations, the Bank of England on Thursday kept interest rates on hold for the third time in a row as its fight against stubborn inflation continues.

The bank would tighten policy further if it sees "more persistent inflationary pressures."

"The Monetary Policy Committee will continue to monitor closely indications of persistent inflationary pressures and resilience in the economy as a whole, including a range of measures of the underlying tightness of labor market conditions, wage growth and services price inflation," it said in a statement.

The bank also said it "will need to be sufficiently restrictive for sufficiently long to return inflation to the 2% target sustainably in the medium term."

It also anticipates that GDP growth will remain relatively stable in the last quarter of the current year and in the subsequent quarters.

"The Committee continues to consider a wide range of data on developments in labor market activity. Employment growth is likely to have softened, and there has been further evidence of some loosening in the labor market," it added.

It also said 12-month inflation went down sharply from 6.7% in September to 4.6% in October.

"Inflation is expected to remain near to its current rate around the turn of the year. In particular, services price inflation is projected to increase temporarily in January, related to base effects from unusually weak price movements at the start of this year, before starting to fall back gradually thereafter," it added.