The Bank of England’s Monetary Policy Committee has decided to hold Base Rate at 0.50%, and also to hold the Asset Purchase programme (better known as Quantitative Easing) as well.
There was high expectation that Base Rate would be cut so this will come as a surprise to many.
The minutes of the meeting show the Committee remains concerned about the potential impact of the vote to leave the EU, but have decided to wait for Augusts inflation report to get a clearer picture of what’s actually happening.
Most members, the minutes say, ”expect monetary policy to be loosened in August” though what form that might take remains to be seen.
One member voted to reduce Base Rate to 0.25% and the vote to hold QE was unanimous, so if we’re looking for a hint of what may come, nothing is certain at present.
What is clear is that the Bank of England doesn’t see the need for an immediate interest rate cut, which is reassuring.
For now though, borrowers on variable rates hoping the Bank of England would do them favour can of course take matters into their own hands and look to some of the record low rates already available.
No change to Base Rate....Yet