BoE cut the Bank Rate by 25 bps to 5.00% today, in a closely contested 5-4 vote. Governor Andrew Bailey, Deputy Sarah Breeden, new Deputy Clare Lombardelli, known dove Swati Dhingra, and Dave Ramsden voted in favor of the cut. Chief Economist Huw Pill, Megan Greene, Jonathan Haskel, and Catherine Mann voted against the change.
In the accompanying statement, BoE stated it is now “appropriate to reduce slightly the degree of policy restrictiveness.” The central bank noted that the impact of past external shocks “has abated” and there has been “some progress” in moderating inflation risks.
Despite the cut, BoE emphasized that restrictive policy will continue to weigh on economic activity, leading to a looser labor market and reducing inflationary pressures.
