The Trader Harbor
  • Business
  • Politics
  • World News
  • Stocks
  • Business
  • Politics
  • World News
  • Stocks

The Trader Harbor

Business

Bank of England holds rates, stresses June cut depends on coming data

by admin May 10, 2024
May 10, 2024
Bank of England holds rates, stresses June cut depends on coming data

LONDON — The Bank of England on Thursday announced a widely expected hold on interest rates as it said restrictive monetary policy was taming inflation, but warned a June rate cut was not a done deal.

Members of the central bank’s Monetary Policy Committee voted 7-2 to hold, with the latter favoring a cut. In the prior meeting only one member voted for a cut.

The MPC nonetheless cautioned that indicators of inflation persistence “remain elevated,” highlighting that services inflation came in at 6% in March, and that there are “upside risks” to the near-term outlook from geopolitics.

It said it would monitor upcoming data releases closely. Two consumer price index prints are due before its next meeting on June 20.

The decision keeps the BOE’s key Bank Rate at 5.25%.

“We need to see more evidence that inflation will stay low before we can cut interest rates,” BOE Governor Andrew Bailey said in a statement reported by Reuters.

“I’m optimistic that things are moving in the right direction.”

Market anticipation has been building for interest rate cuts to begin in the summer, with money markets fully pricing in a 25 basis point reduction in August and 50 basis points overall this year.

Some economists see a cut in June and three or more cuts in 2024, though market pricing suggested a 45% probability of that following the meeting.

U.K. headline inflation is forecast to drop dramatically in April due to lower energy prices, from the current 3.2% to below the BOE’s 2% target, according to some projections.

In its Thursday release, the BOE said it expected it expected the U.K. gross domestic product to grow by 0.4% in the first quarter of the year, and by 0.2% in the second quarter. The economy fell into a shallow recession in the second half of 2023.

It meanwhile sees headline inflation close to 2% in the near-term, and expects it to increase slightly later in the year as the drag from the energy market wanes.

In a press conference following the announcement, Bailey emphasized the message in its statement that the MPC “will consider forthcoming data releases and how these inform the assessment that the risks from inflation persistence are receding.”

“June is not a fait accompli, but each meeting is a new decision,” he said.

Paul Dales, chief U.K. economist at Capital Economists, noted the BOE had repeated previous messaging on monetary policy remaining restrictive for “sufficiently long” and for “an extended period.”

This “suggests to us that the Bank is not implying it will cut rates at the next policy meeting in June,” he said in a note.

“But the new line that the MPC will ‘consider forthcoming data releases and how these inform the assessment that the risks from inflation persistence are receding’ implies that the MPC is willing to change its stance and that the data will determine when that happens.”

Wage data may end up informing whether the cut falls in June or August, he added.

This post appeared first on NBC NEWS

0
FacebookTwitterGoogle +Pinterest
previous post
Hyundai and Kia unit settles U.S. charges it repossessed service members’ vehicles
next post
Weekly mortgage refinance demand rose 5% after a slight dip in mortgage rates

Related Posts

As his feud with Trump reignites, Musk’s business...

July 3, 2025

Boeing’s crewed Starliner flight won’t return until at...

July 27, 2024

Nvidia’s CEO did a Q&A with analysts. What...

March 25, 2025

Tesla to recall 125,227 vehicles over faulty seat...

June 1, 2024

Boeing machinists on picket lines prepare for lengthy...

September 24, 2024

Trump Media shares end week down nearly 20%,...

April 13, 2024

Walmart fined for shipping realistic toy guns to...

May 28, 2025

Chipotle downplays looming Trump tariffs, says only half...

February 7, 2025

Peloton launching resale market for used bikes, treadmills

June 4, 2025

Private payroll growth slowed to 122,000 in July,...

August 1, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest

    • Amazon extends Prime Day discounts to 4 days as retailers weigh tariffs and price increases

      July 10, 2025
    • Breakout Watch: One Stock in Each Sector to Watch Now

      July 10, 2025
    • Small Caps Are Rotating In — Here’s Why It Matters

      July 10, 2025
    • Want Faster, Lower Risk Trades? Use This Setup

      July 10, 2025
    • The Seasonality Trend Driving XLK and XLI to New Highs

      July 10, 2025
    • Biden doctor dodges questions in speedy House closed-door interview

      July 10, 2025

    Categories

    • Business (1,287)
    • Politics (3,949)
    • Stocks (1,504)
    • Uncategorized (45)
    • World News (1,280)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: TheTraderHarbor, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 thetraderharbor.com | All Rights Reserved