The Bank of England on Thursday announced that it had left interest rates unchanged at 0.1 percent following a meeting of the Monetary Policy Committee (MPC) on Wednesday.

The Bank, however, mentioned that a move to introduce negative interest rates had been discussed in the wake of the "decline in global interest rates over a number of years".

"The MPC had been briefed on the Bank of England's plans to explore how a negative Bank rate could be implemented effectively, should the outlook for inflation and output warrant it at some point during this period of low equilibrium rates."

The Bank also announced that it will continue with its separate bond purchase stimulus scheme and maintain the stock of those purchases at £745 billion.

The Bank also admitted that the outlook for the economy remained "unusually uncertain". In its Monetary Policy Report last month, the UK GDP was projected to continue its recovery based on various factors. These were the gradual disappearance of the direct impact of COVID-19 and an "immediate, orderly move to a comprehensive free trade agreement with the European Union".

"Nonetheless, the recovery in demand took time as health concerns were expected to drag on activity," the Bank said in its report.

The Bank said economic recovery remained on course but warned that recent increases in COVID-19 cases threatened to derail economic activity, though not as severely as was witnessed earlier in the year.

"Recent domestic economic data have been a little stronger than the Committee expected at the time of the August Report, although, given the risks, it is unclear how informative they are about how the economy will perform further out."

The report noted that investment intentions had remained "very weak" and uncertainties among businesses had increased.

The Bank also warned of the possibility of a sharp rise in unemployment as considerable uncertainty also remained around the labour market.

"As in the August Report, there remains a risk of a more persistent period of elevated unemployment than in the central projection."

(With input from agencies)