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MNI BOE WATCH: Cuts 25BP, Sees Slow Return To Inflation Target

The BOE cuts 25 basis points but the Budget had a sizeable impact on its inflation projections.

MNI (LONDON) - The Bank of England’s Monetary Policy Committee voted eight-to-one to cut Bank Rate by 25 basis points to 4.75% at its November meeting, but it substantially raised its inflation projection to reflect the impact of the fiscal easing in the Oct 30 Budget.

Only Catherine Mann dissented, backing unchanged policy, and Governor Andrew Bailey said that further gradual easing was likely following only the second cut this cycle. The MPC's new quarterly forecasts, however, were raised substantially, with inflation shown moving above the 2.0% target and only returning to it in Q2 2027, with the 2026 forecast now 2.25% compared to 1.5% previously. (See MNI INTERVIEW: UK Budget Ups Inflation Pressure - OBR Miles )

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MNI (LONDON) - The Bank of England’s Monetary Policy Committee voted eight-to-one to cut Bank Rate by 25 basis points to 4.75% at its November meeting, but it substantially raised its inflation projection to reflect the impact of the fiscal easing in the Oct 30 Budget.

Only Catherine Mann dissented, backing unchanged policy, and Governor Andrew Bailey said that further gradual easing was likely following only the second cut this cycle. The MPC's new quarterly forecasts, however, were raised substantially, with inflation shown moving above the 2.0% target and only returning to it in Q2 2027, with the 2026 forecast now 2.25% compared to 1.5% previously. (See MNI INTERVIEW: UK Budget Ups Inflation Pressure - OBR Miles )

Keep reading...Show less