Bank vote hints at interest rate rise in May

Bank vote hints at interest rate rise in May

The Bank of England has left the door open to raise UK interest rates in May after making no change this month, holding them steady at 0.5%.

Two members of the Bank’s nine-member Monetary Policy Committee – Ian McCafferty and Michael Saunders – backed an increase in rates to 0.75%.

That was a departure from the unanimous vote at the last MPC meeting in February.

In November, the Bank raised rates to 0.5%, the first increase for a decade.

The MPC said “ongoing tightening” was likely to be needed to return inflation back to the Bank’s 2% target.

On Tuesday, the Office for National Statistics said consumer price inflation was 2.7% in February, down from 3% the previous month and the lowest figure since July 2017.

Alan Clarke at Scotiabank said he was “more and more confident” that the MPC would raise rates in May.

“Thereafter we expect a rate hike in November, but its not going to be plain sailing getting there,” he added.

Bank vote hints at interest rate rise in May

Source: BBC News

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