The Bank of England’s Monetary Policy Committee (MPC) has once again voted to keep the Bank Rate at 0.5%.
The MPC also voted to maintain the stock of purchased assets financed by the issuance of central bank reserves – so-called ‘quantitative easing’ at £375 billion.
The previous change in Bank Rate was a reduction of 0.5 percentage points to 0.5% on 5 March 2009.
David Meier, senior economist at Julius Baer, said: “Today’s Bank of England (BoE) policy meetings seems rather to be a non-event, as the policy mix will likely be left unchanged. Nevertheless, following a recent bout of disappointing economic data, we believe that speculation about an early rate hike is subsiding. Indeed the UK recovery, which was looking very robust still in the past quarter, seems to be challenged by its own success. A stronger pound in anticipation of 2016 BoE rate hikes in times of faltering global demand is beginning to drag on the manufacturing and exports sector.
“On the other hand, domestic demand still looks rather strong, offering hope that we are seeing only a temporary setback. We have not shifted back our expectations for the first BoE rate hike from February 2016, but admit that the risk of further delays is rising and that the decision remains highly dependent on data released in the coming months. For now, BoE Governor Mark Carney has few options other than trying to provide some stimulus by talking down the pound, down-playing the strength of the recovery.”