Analysts at Rabobank explain that the the Bank of England MPC kept policy on hold at today’s meeting with unanimous vote.
Key Quotes
“The guidance was left untouched as well: “an ongoing tightening of monetary policy over the forecast period, at a gradual pace and to a limited extent”, is still seen as the way forward if everything goes as planned.”
“But the economic outlook depends significantly on Brexit. As no-one can confidently predict what will happen after March 29, the MPC also judges that the policy response to Brexit “will not be automatic and could be in either direction”.”
“Headline inflation is slowing due to mostly exogenous factors, but domestic cost pressures are building. The meeting in May therefore offers the best hope of a hike to 1.00%, but this assumes that the UK will be leaving the EU with a deal in place.”
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