For the 16th month in a row, interest rates in the UK were held at a record low of 0.5% by the Bank of England. This news didn't necessarily come as a great surprise to those who keep their fingers on the pulse of the UK economy, but it has raised concerns with people who are worried about inflation. Such people were hoping for an increase in interest rates, which they believe will help curb or slow inflation. Their concerns are backed up by the latest Consumer Prices Index, which hit a 17-month high of 3.7% in April. It fell in May to 3.4%, but continues to be well above the target rate of 2% that the Bank of England wants.

In related news, the UK economy grew by 0.7% in the three months leading up to the end of June 2010. However, that rate is lower than the one for the three months leading up to May, which stood at 0.9%. In other words, a major expansion - or, at least, a consistent one - is hardly underway as of yet. When combined with the high rate being reporting by the Consumer Prices Index, it's easy to see why so many people are fretful. The Monetary Policy Committee, or MPC, won't be putting any more money into the economy, either. The slowdown in expansion and the stagnant interest rate both signal additional financial woes.

The one bright spot amid all of the turmoil concerns the cost of living for homeowners in the UK. Per the Halifax, the cost of owning and operating a home in the UK is down by about 6% right now. For people who are turning to quick cash in record numbers, this is certainly positive news. However, they are generally paying for the crippled economy in other ways; after all, inflation is taking its toll and consumer prices are creeping ever upward. Anyone who was hoping for a major upswing within the first half of 2010 is definitely let down. With any luck, however, the second half of the year will bring about some positive changes.