Bank of England keeps interest rates on hold as it monitors economy's recovery

Economic Indicators Associated Press

The Bank of England has decided to keep interest rates steady despite the economy's strong recovery as it first wants to see a stronger rise in wages and inflation remains low.

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Policymakers voted Thursday to keep the key rate at a record low 0.5 percent and to refrain from pumping money into the economy.

Governor Mark Carney has suggested rates could start rising next year. But with inflation at 1.5 percent, below the 2 percent target, pressure to do so remains muted.

The bank also wants to see a robust increase in wages. Britain's economy is recovering faster than most European countries, but pay increases have been slow.

Meanwhile, the Royal Institute of Chartered Surveyors reported a drop in housing prices in London for the first time in four years.