5/11/2017, 1:01 PM (Source: TeleTrader)
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BoE holds rate at 0.25% with one vote for hike

British monetary policy makers led by Governor Mark Carney said on Thursday that they decided to maintain existing quantitative easing measures and keep the main rate of interest at 0.25%. Kristin Forbes was the only person in the eight-member panel that voted for the benchmark to be lifted, the same as in the previous meeting. The Monetary Policy Committee has one less member than in March.

Aggregate demand slowed markedly in the first quarter and consumption growth is expected to slow in the short term, the report says and notes the pound rose 2.5% from February's inflation report until now. On the flipside, the drop of 16% in the past year bolstered inflation and wage growth has lagged, BoE underscored. Consumer prices growth is expected to climb near 3% in the fourth quarter and to hold above target by 2019, according to the minutes.

The projection for annual inflation in the second quarter was bumped up three projection points from the February report, to 2.7%. The rate for the same three months of next year is seen 0.2 points lower, at 2.6, and 0.3 points lower than in the previous estimate for the period from April through June 2019, at 2.2%. The forecast for one year after that is 2.3%. The projection for the increase in the bank rate was slightly muted, and it is expected to reach 0.5% at the end of the period. However, the pace depends on how Britain's departure from the European Union is arranged, BoE said. The unemployment rate is seen slowly declining from 4.7% to 4.5% by 2020, against a forecasted slight rise from the February update.

Baha Breaking News (BBN) / IT