Bank of England: still three voting for a hike and no rate cut decision

Commenting on today's rate decision from the Bank of England, Melanie Baker, senior economist at Royal London Asset Management, said: 

"The Bank of England’s Monetary Policy Committee (MPC) again flagged that the decision to hold or hike was ‘finely balanced’. The minutes do not mention that there was any discussion of rate cuts, though it sounds as if one MPC member might have been close to voting for a cut: ‘For one member, the risks of overtightening policy had continued to build’.  

"The MPC doesn’t have a press conference in December and doesn’t publish its own rate forecasts. Still, the overall tone was quite a contrast to the relatively dovish-sounding Federal Reserve last night. 

"The committee continues to judge that risks to their inflation forecasts are on the upside and although there were definite dovish elements to some of the economic commentary, they still see it as too early to conclude that services inflation and pay growth are on a firm downward path. 

"Overall, there wasn’t much change in tone from the Bank of England today, but the February Report will be accompanied by their annual “stocktake” of supply capacity so would probably be the more likely time to expect a bit of a shift in tone."