The Monetary Policy Committee voted 8-1 to keep rates steady, with one member voting to cut by 25 basis points to 5%.
The Monetary Policy Committee voted 8-1 to keep rates steady, with one member voting to cut by 25 basis points to 5%. Notably, no members voted for further hikes for the first time in this cycle, after two members favored a quarter-point increase at the previous meeting.The central bank expects the consumer price index to return to its 2% target in the second quarter, as the household energy price cap is once again lowered in April.
The MPC maintained that monetary policy "will need to remain restrictive for sufficiently long to return inflation to the 2% target sustainably in the medium term." Major central banks around the world are trying to determine when to begin unwinding monetary policy after two years of rapid tightening, in a bid to tame a global inflation surge.and stuck with its forecast for three rate cuts this year, with Chair Jerome Powell seeking confirmation that inflation is returning to the 2% target despite a recent spate of hotter-than-expected readings.Sterling retreated, and U.K.
Thiru accused the Bank of being "overly cautious" on potential rate cuts, given the rate of the inflation slowdown and an economy in recession. He suggested that keeping policy "too tight for too long" risks prolonging the country's economic struggles.
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