BoE left Bank Rate unchanged at 5.25%, as widely anticipated, with a 7-2 vote among the Monetary Policy Committee members. Swati Dhingra and Dave Ramsden again voted for a 25 bos cut to 5.00%.
The central bank stated that, as part of the August forecast round, the Committee will review all available information to assess whether the risks from persistent inflation are receding. Based on this assessment, the Committee will determine how long the Bank Rate should be maintained at its current level.
While CPI fell to 2% in May, BoE expects it to “rise slightly” in the second half of the year due to the base effects from last year’s energy price declines. Additionally, BoE noted that services inflation at 5.7% was “somewhat higher” than projected in the May monetary policy report.
On the growth front, GDP appears to have “grown more strongly than expected” during the first half of the year but remains consistent with a growth rate of around 0.25% per quarter.
Full BoE statement here.
