The Bank of England’s Monetary Policy Committee (MPC) voted 6–3 to maintain its Bank Rate at 5.25%.
This marked the second consecutive MPC where the rate was not increased – the rate is at its highest level in 15 years. The three dissenting MPC members sought to increase the rate by 0.25 percentage points to 5.5%.
“The MPC’s latest projections indicate that monetary policy is likely to need to be restrictive for an extended period of time,” said the central bank in a statement. “Further tightening in monetary policy would be required if there were evidence of more persistent inflationary pressures.”
U.K. inflation is currently at 6.7%, considerably above the Bank of England’s 2% goal. But the nation’s economy is not strong and Bank of England Governor Andrew Bailey warned inflation is “still too high.”
The decision not to proceed with a rate hike mirrors yesterday’s decision by the Federal Reserve and similar decisions from last week by the central banks of Canada and the European Union.
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