The Bank of England Monetary Policy Committee has today confirmed that its central bank interest rate will remain at 5.25% for the 10th consecutive month.
Yesterday, the Office for National Statistics reported that UK inflation had fallen to the Bank of England’s ‘trend growth’ target rate of 2% pa. This does give the Bank some room for manoeuvre. That said, the Bank had already suggested that it would not make an interest rate change this month due to the General Election on 4th July. This is usual as the Bank of England does not want to make any ‘political statements’ or have any influence either way on the electorate of the coming vote.
We have long forecast that interest rates may even not come down until September or early Autumn given:
Comment
June’s inflation figures are due in July, so it is possible that the Bank may cut rates in August although given any new Parliament will likely be closed for Summer Recess, so the Bank may again wait until September.