Bank Of England Unanimous On Rate, QE
December 14 2017 - 2:58AM
RTTF2
The Bank of England policymakers unanimously decided to leave
its key interest rate unchanged on Thursday after tightening it for
the first time in a decade in November.
The Monetary Policy Committee, headed by Governor Mark Carney,
voted to maintain the benchmark rate at 0.50 percent. The bank had
raised its rate by a quarter point at the previous session in
November.
Policymakers voted unanimously to maintain the quantitative
easing at GBP 435 billion.
If the economy performed as estimated in November, the MPC said
'further modest increases' would be warranted over the next few
years, in order to return inflation sustainably to the target.
The bank noticed two significant events regarding the
macroeconomic outlook since the November meeting. According to BoE,
measures announced in the Autumn Budget would reduce the drag on
aggregate demand.
Accordingly, the level of GDP would be boosted by around 0.3
percent over the three-year forecast period and inflation would be
around 0.1 percentage points higher as a result of the
measures.
The second significant event had been the progress made on
Brexit talks. This would reduce the likelihood of disorderly exit
and would likely support household and corporate confidence, the
bank observed.
Inflation rose to 3.1 percent in November. The MPC judged that
inflation is likely to be close to its peak, and will decline
towards the 2 percent target in the medium term.
The governor will be writing an open letter to the Chancellor to
explain this overshoot and this will be published alongside the
minutes of the February MPC meeting and the accompanying Inflation
Report, the bank said.
The bank said the Committee will monitor closely the incoming
evidence on the evolving economic outlook, including the impact of
last month's increase in Bank Rate, and stands ready to respond to
developments as they unfold to ensure a sustainable return of
inflation to the 2 percent target.
Euro vs US Dollar (FX:EURUSD)
Forex Chart
From Aug 2024 to Sep 2024
Euro vs US Dollar (FX:EURUSD)
Forex Chart
From Sep 2023 to Sep 2024