BoC hikes overnight by only 50bps to 3.75%, disappointing those expecting a 75bps hike. Bank Rate and deposit rate are at 4.00% and 3.75% respectively. The central bank maintains tightening bias, and noted that “the Governing Council expects that the policy interest rate will need to rise further”.
In the new economic projections, GDP growth was downgraded from 3.5% to 3.3% in 2022, from 1.8% to 0.9% in 2023, and from 2.4% to 2.0% in 2024. CPI inflation forecasts was also downgraded from 7.2% to 6.9% in 2022, from 4.6% to 4.1% in 2023, and from 2.3% to 2.2% in 2024.
