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Key points from the decision

  • No pushback on higher yields (or on money market pricing).
  • No change to the purchase pace.
  • No real changes to forward guidance.
  • Some had expected a slowdown in the purchase pace but that hasn't happened so gilts are a bit higher on the back of that.
  • Key line "An aggregate measure of UK financial conditions has been broadly unchanged since the February Report."
  • Promise to look more into spare capacity in May: "There was a range of views across MPC members on the degree of spare capacity in the economy currently, whether demand would outstrip supply during the recovery from the pandemic, and how the assessment of supply should take into account the unique nature of the economic shock from the pandemic. Further discussion of these issues would be an important part of the Committee's forecast process ahead of the May Report."
  • Acknowledgement that the outlook was more positive near-term: "The news on near-term economic activity had been positive, although the extent to which that news changed the medium-term outlook was less clear. Different MPC members placed different weights on the balance of risks around the outlook."

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