Sir Mervyn King, the governor of the Bank of England has indicated that the low interest rates are likely to continue and dismissed suggestions of monetary policy tightening.

Sir Mervyn assured the industry that the interest rates are likely remain low as rising interest rates would create problems for the indebted homeowners. The officials form the Downing Street has also asked for easing off some of the banks. He also backed the government in its decision to manage Lloyds Banking Group and Royal Bank of Scotland.

Sir Mervyn told the Treasury committee, "The idea that we are about to return to normal levels of interest rates is premature. It would be wrong to give any kind of timetable." He also said that the central bank is not likely to increase interest rates until there is evidence of a sustainable economic recovery in the UK's economy.

Canadian Mark Carney, who has been working as the Governor of Bank of Canada, will be appointed as the new chief of the Bank of England next Monday. He indicated that the central bank will not increase interest rates until some targets are met suggesting that the liberal monetary policy will remain intact in the country for some time.