The Bank of England’s monetary policy committee members once again voted unanimously to keep the bank rate at 0.10 per cent.

The MPC minutes show the members believe UK gross domestic product will recover strongly across 2021 “towards pre-Covid levels” but that unemployment will increase over the next two quarters. Overall, the country’s economic outlook is “unusually uncertain”, the MPC adds.

Regarding inflation, the MPC retains the position it held at last month’s meeting – namely, that the consumer price index measurement of inflation will “swiftly” rise towards 2 per cent this Spring.

It adds that the 12-month CPI inflation rate rose slightly to 0.7 per cent in January 2021.

The report also states that UK GDP dropped by 2.9 per cent this January, “less weak than expected”, but still leaves GDP circa 10 per cent below the level seen in Q4 2019. The MPC believes that a loosening of restrictions may result in stronger consumption growth in the second quarter of this year than previously expected.

Mortgage credit conditions have eased since the February meeting, the notes go on to say, adding that spreads have fallen and that product availability has increased.