At its meeting ending on September 18, the Bank of England’s Monetary Policy Committee, or MPC, voted by a majority of 8-1 to maintain Bank Rate at 5%. One member preferred to reduce Bank Rate by 0.25 percentage points, to 4.75%. “The Committee voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by GBP 100 billion over the next 12 months, to a total of GBP 558 billion. Monetary policy decisions have been guided by the need to squeeze persistent inflationary pressures out of the system so as to return CPI inflation to the 2% target both in a timely manner and on a lasting basis. Policy has been acting to ensure that inflation expectations remain well anchored. As set out at the time of the August Monetary Policy Report, the Committee’s deliberations have been supported by the consideration of a range of cases, to which different probabilities and different risks can be attached,” the BOE stated.
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