Saturday , 18 January 2025
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BOE leaves bank rate unchanged at 5.00%, as expected

  • Prior 5.00%
  • Bank rate vote 8-0-1 vs 7-0-2 expected (only Dhingra dissented, wanting to cut by 25 bps)
  • Need to be careful not to cut rates too fast or by too much
  • Most MPC members think in the absence of material developments, a gradual approach to removing policy restraint would be warranted
  • Labour market continued to loosen but that it remained tight by historical standards
  • But data quality issues continued to be an area of concern i.e. LFS
  • “Range of views” on inflation persistence among those who voted to keep rates unchanged
  • Despite that, the current policy stance was judged to be appropriate
  • Monetary policy will need to continue to remain restrictive for sufficiently long
  • To monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting
  • Full statement

This article was written by Justin Low at www.forexlive.com.

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