Bank of England’s Monetary Policy Committee (MPC) meeting was held yesterday where it was unanimously voted (9-0) to maintain Bank Rate at 0.75% after it hiked rates last meeting in August to meet the 2% inflation target to help sustain growth and employment. It confirmed that further increases are probably required to tame inflation. Economic growth was on course to beat expectations for the third quarter but it cautioned over ‘greater uncertainty’ on Brexit.
The members maintained the stock of UK Government bond purchase and sterling non-financial investment-grade corporate bond purchases, both financed by the issuance of central bank reserves, at £435 billion and at £10 billion respectively.
Last month the bank had indicated that rates would need to rise by around quarter point a year over the next 2-3 years to contain inflation which is currently at 2.5% back on track. The committee also note the potential negativity from the trade talk tensions between US and China.