Today the Bank of England decided to keep interest rates on hold at 5.25%. This is the second month in a row that the bank has refused to hike rates but there are many who believe that rates will go up another quarter of a percent to 5.50% in May due to rising inflation which crept back up to 2.8% this month. The bank would ideally like to see inflation below 2% but that doesn't look likely at the moment even though the economy is still in pretty good nick overall.

This latest decision is good news for borrowers and property investors who have borrowed more to buy property abroad. Current euro interest rates are at 3.75% and many expect this to go up to 4% by the summer in a bid to combat inflation in the euro zone.

The cost of borrowing is still relatively low and there are many who expected 2007 to be 'the' year of interest hikes so things could be far worse. The property markets in both the UK and eurozone are still doing very well and the rate rises of recent times have not done much to stop property prices spiralling in most countries. If inflation can be brought under control in the second half of 2007 then there could be some interest rate reductions on the way..don't hold your breath though!