Bank of England announced its interest rate decision
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The Bank of England (BoE) kept the policy rate constant at 5.25 percent, in line with expectations.
In the statement made by the BoE, it was stated that at the Monetary Policy Committee (MPC) meeting, 8 members voted to keep the policy rate constant and one to reduce it to 5 percent with a 25 basis point discount.
In the statement, it was reminded that the annual inflation in the country fell below expectations with 3.4 percent in February, and it was stated that although the service sector inflation also decreased, it was still at a high level with 6.1 percent.
In the statement, it was noted that many short-term inflation expectations continued to ease, and it was reported that inflation was predicted to fall slightly below the targeted level of 2 percent in the second half of this year.
“WE ARE NOT AT A POINT WHERE WE CAN LOWER INTEREST”
In his evaluation of the decision, BoE Governor Andrew Bailey stated that there have been “encouraging” signs that inflation has decreased in recent weeks and said, “Today, we kept the policy rate constant at 5.25 percent because we need to be sure that inflation will fall to our 2 percent target and remain at that level.” “We are not yet at a point where we can reduce the interest rate, but things are moving in the right direction,” he said.
The BoE started the tightening cycle in December 2021 and increased the policy rate to 5.25 percent as of August 2023. BoE has kept the policy rate at the same level since the said date.
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