The Bank of England's Monetary Policy Committee (MPC) voted 7-2 on Thursday to keep its primary interest rate at 5.25%, remaining at its highest level in 16 years since August last year. The two members of the committee that voted differently believed it was suitable to lower the rate by an additional quarter of a percentage point, which would have brought it to 5.0%.
The BoE said that "CPI inflation is expected to rise slightly in the second half of this year, as declines in energy prices last year fall out of the annual comparison." Furthermore, the policymakers pointed out that the UK's gross domestic product was estimated to have risen by 0.5% in the first quarter and is expected "to continue to grow at a similar pace" in the second quarter.
"The Committee noted that the timing of the general election on 4 July was not relevant to its decision at this meeting," the report noted.
