The Bank of England (BoE) Monetary Policy Committee (MPC) announced on Thursday its decision to cut its interest rates by 25 basis points to 4%, as predicted. At the previous meeting, the institution held them steady. This time, the MPC voted 5–4 to lower the rates.
The report noted that the progress in diminishing inflationary pressure allowed the committee to loosen its monetary policy. Still, the MPC also pointed out that, due to the overall economic uncertainty, the United Kingdom's annual inflation rate could reach up to 4% in September. However, it also projected that the figure will drop to 2% after that.
The MPC reaffirmed its commitment to a data-driven approach in making upcoming monetary policy decisions. "If the economy evolves as expected, we expect to reduce interest rates further over time," it said. "If prices are consistently higher than expected, we may need to cut interest rates more slowly."
