In the updated economic projections in the Inflation Report, BoE lowered 2019 Q4 four-quarter GDP forecasts from 1.8% to 1.7%. For 2020, four-quarter GDP forecast was kept unchanged at 1.7%. On CPI inflation, BoE lowered CPI forecast for 2019 Q4 to 2.1% from 2.2%. However, for 2020 Q4, inflation forecast was raised to 2.1% from 2.0%. Bank Rate forecasts for 2019 Q4 was raised from 0.9% to 1.0%. For 2020, Bank Rate forecasts was also raised from 1.1% to 1.2%.
In short, the economic outlook was actually largely unchanged. Nonetheless, BoE is now more certain on a rate hike in 2019, and probably another one in 2020. Indeed, from the conditioning path that BoE used, the next rate hike is pulled ahead from Q1 2020 to Q4 2019. And, another rate could even but seen in between Q3 2020 and Q1 2021.
