Old Lady holds rates, relaxes reserve rules

The Bank of England's Monetary Policy Committee on Thursday said it would keep its benchmark rate at 5.75%.

The rate hold was the third in a row for the Bank, since the 25 basis point hike in July due to concern over inflation. At that point, rates were expected to hit 6% before the year-end.

But the Bank now has a very different set of problems to deal with, coming under a great deal of strain for its perceived role in the Northern Rock affair, which led to the first run on a UK bank since t