The Bank of England voted 9 to 0 to maintain Base Rate at 0.75%. The asset purchase target of £435 billion for corporate and UK government bond purchases was voted unaminous.
The Bank of England voted 9 to 0 to maintain Base Rate at 0.75%. The asset purchase target of £435 billion for corporate and UK government bond purchases was voted unaminous.
Highlights:
Bank of England announces 1 November monetary policy decision
- Unchanged at prior 0.75%
- Official bank rate votes 0-0-9 vs 0-0-9 expected
- Asset purchase target £435 bn vs £435 bn expected
- Corporate bond target £10 bn vs £10 bn expected
Statement Breakdown
- Ongoing tightening of monetary policy appropriate if economy grows as forecast ‘
- Any future increases in bank rate likely to be at gradual pace and to be a limited extent
- Market interest rate implies slightly steeper rise in bank rate
- That means reaching 1.4% by late 2021 (in August this was 1.1%)
- Monetary policy response to Brexit is not automatic, could be in either direction
- Forecasts growth of +0.6% q/q in Q3, +0.3% q/q in Q4
- Forecasts growth of +0.4% q/q in subsequent quarters
- Cuts 2018 GDP growth to +1.3% (August +1.4%)
- Cuts 2019 GDP forecast to 1.7% (August +1.8%), forecasts GDP at 1.7% for 2020, 2021
Source: Bank of England