June 16, 2022 11:00 GMT
- The Bank of England decided 6-3 to raise the bank rate by 25bp to 1.25% in the June 16 meeting.
- Haskel, Mann and Saunders voted for a 50bp hike.
- The BOE dropped its forward guidance along the lines of "some degree of further tightening in monetary policy may still be appropriate..." and stated explicitly that the "scale, pace and timing of further increases in bank rate will reflect the committee's assessment of the economic outlook and inflationary pressures... will if necessary act forcefully in response".
- This shift highlights renewed flexibility going forward for both the timing and magnitude of upcoming hikes.
- CPI is now seen rising "slightly above 11%" in October, upwards of a 0.6pp revision on the 10.4% forecast in the May report. With core inflation running higher than both the Eurozone and US, additional price pressures resulting from domestic factors imply more entrenched UK inflation as highlighted in the statement.