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The Bank of England is holding UK interest rates at a record low of 0.5% and the Bank’s Monetary Policy Committee (MPC) voted 8 to 1 to keep rates the same.

UK interest rates have remained unchanged for over six years and Ian McCafferty, a committee member, disagreed and voted for a quarter-point rate rise for a third month in a row.

Inflation will stay below 1% until spring 2016 and cost pressures in the UK’s labour market is rising too slowly for inflation to return to the Bank’s 2% target, the central bank said.

Although inflation has stayed around 0% for a few months, the Bank indicated that the fading effect of last year’s oil price falls and robust domestic growth would cause it to increase to 2% next year.

UK inflation rose in July with the Consumer Prices Index (CPI) measure rising to 0.1%. In June, the percentage stayed at 0% and the Office for National Statistics (ONS) stated that the main reason that inflation rose is because of the lower prices of clothing.

However, the Retail Prices Index measure of inflation has stayed the same at 1% and this will be used to calculate rail fare increases. The fares will remain the same until next year.

For the last six months, CPI has been almost flat and turned negative in April. This is the first time since 1960. CPI inflation strips out increases in energy, food, alcohol and tobacco. In addition to this, the underlying measure of CPI inflation rose to 1.2% in July, which is a five-month high. The ongoing supermarket price war could be the reason that CPI was held back, with a 2.7% year-on-year fall in the price of food and non-alcoholic drinks.

Taking all this into consideration, there has been question over when the Bank of England might raise interest rates. The Bank has a target inflation rate of 2%.

In the past two months, the drop in the price of oil has fallen by nearly a quarter, which is why analysts have said that the inflation rate could fall back again.

The Bank of England has kept UK interest rates at 0.5%. Not only that but the Bank also kept the size of its bond-buying stimulus programme unchanged at £375 billion. The decision comes more than six years after the record low was introduced. The Bank’s Monetary Polity Committee (MPC) made the decision.

Mortgage borrowers have benefited from lower repayments and the half-dozen years of ultra-low interest rates have cut savings’ returns. In April, ultra-low inflation turned negative to -0.1%, which has put on hold expectations about the Bank raising rates in 2015.

The Bank claimed in its quarterly inflation report last month that it was likely to raise the cost of borrowing in the middle of next year. On a different note, the recent ONS figures confirmed that the UK gross domestic product (GDP) growth slowed to 0.3% in the first quarter. This was the worst result since the end of 2012.

In all previous meetings so far this year, the nine-strong MPC has voted unanimously to keep rates on hold.