LONDON — The Bank of England will shortly release the decisions made at its latest Monetary Policy Committee meeting, held on Wednesday, as well as its Quarterly Inflation Report — the three-monthly update of its forecasts for the economy.
It is widely expected that there won’t be any change to the Bank’s monetary policy, with interest rates set to stay at a record low of 0.25% and the bank’s QE programmes capped at £435 billion.
Policy is unlikely to change, but the way the MPC votes, could shift. (The MPC is currently just eight members after the abrupt resignation of new deputy governor Charlotte Hogg in March.)
At the bank’s March meeting, the committee voted 8-1 in favour of leaving rates unchanged, with just the outgoing Kristin Forbes voting for a hike. One or two committee members are thought to be considering joining her this month, with Ian McCafferty the most likely.
While monetary policy will almost certainly be unchanged, macroeconomic forecasts for both inflation and wider growth are both likely to see significant changes, with numerous economists speculating that the Old Lady of Threadneedle Street could raise its inflation forecast from its current peak prediction of 2.8% to somewhere around 3%.
Inflation has surged in recent months due to the plummeting value of the pound since Britain voted to leave the EU last summer. The fall in sterling has pushed up the price of importing goods, which gets passed through to everyday items that people buy. This is now showing up in official inflation data, with the latest reading at 2.3%, a level not seen since early 2014.
Following the announcement of the BoE’s policy decisions and the release of the Inflation Report at 12.00 p.m. BST (7.00 a.m. ET), Governor Mark Carney will speak to the press to explain the committee’s decisions and the contents of the report. His press conference will begin at 12.30 p.m. BST (7.30 a.m. ET).
This post will be updated after the Bank of England’s announcements are made.