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© Reuters. Bank of England pauses; interest rates unchanged at 5.25%
Proactive Investors - The Bank of England has left interest rates unchanged, after 14 successive hikes, leaving Base Rate at 5.25%.
The BoE’s Monetary Policy Committee made the decision, which was seen as a 50/50 call by City pundits, in the wake of weaker-than-expected inflation figures on Wednesday.
At its meeting ending on 20 September 2023, the MPC voted by a majority of 5–4 to maintain Bank Rate at 5.25%.
Four members preferred to increase Bank Rate by 0.25 percentage points, to 5.5%.
The MPC didn't rule out further rate increases stating: "Further tightening in monetary policy would be required if there were evidence of more persistent inflationary pressures."
It also hinted rates would stay higher, for longer.
"Monetary policy will need to be sufficiently restrictive for sufficiently long to return inflation to the 2% target sustainably in the medium term, in line with the Committee’s remit," it said.
But it noted "there are increasing signs of some impact of tighter monetary policy on the labour market and on momentum in the real economy more generally."
"Given the significant increase in Bank Rate since the start of this tightening cycle, the current monetary policy stance is restrictive," it added.
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