9:06 AM, 6th August 2020, About 11 months ago
The Bank of England’s Monetary Policy Committee (MPC) voted unanimously to maintain the Bank Base Rate at 0.1% and to hold any quantitative easing measures at current levels.
Any decisions have been met with a wait and see strategy as the economy is showing a less weak position than initial Bank forecasts. However, the outlook is still very uncertain, critically depending on measures taken to protect public health as the pandemic continues, and how governments, households and businesses respond.
The Bank’s projections assume the impact of coronavirus on the economy eases gradually, but with the uncertainties surrounding how the pandemic will evolve domestically and in the global market, the MPC’s medium-term projections are likely to be less accurate and informative than normal.
The Bank’s summary of the current economic position and figures are below:
The above lack of any inflationary pressures in the medium term would suggest changes to current policy in the next few months would not include an increase in interest rates.
In the MPC’s central projection, GDP continues to recover beyond the near term, as social distancing eases and consumer spending picks up further. Business investment also recovers, but somewhat more slowly. Unemployment declines gradually from the beginning of 2021 onwards. Activity is supported by the substantial fiscal and monetary policy actions in place.
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