The Monetary Policy Committee of the Bank of England has voted to cut interest rates by 25 basis points to 4%, as expected by market watchers. After holding at 4.25% last month…
That’s the third rate cut this year. The BoE: “At its meeting ending on 6 August 2025, the MPC voted by a majority of 5–4 to reduce Bank Rate by 0.25 percentage points, to 4%, rather than maintaining it at 4.25%.” Four voted to maintain at 4.25%, one voted to cut to 3.75%…
The bank is dour on growth: “Underlying UK GDP growth has remained subdued, consistent with a continued, gradual loosening in the labour market… Downside domestic and geopolitical risks around economic activity remain, although trade policy uncertainty has diminished somewhat.” Inflation predicted to rise to 4% next month…
The Bank of England is playing down the chances of an intrusive Central Bank Digital Currency today. A win for fans of privacy…
Briefings from staff at the Bank – which previously said it believed a “digital pound” was “likely” to be needed – indicate that the BoE is letting private businesses take the lead and won’t push for a CBDC at this time. They are pernicious risks to financial privacy and a successful hack could topple the system…
Later at his appearance before the Treasury Select Committee in the Commons today BoE Governor Andrew Bailey said private efforts could generate “huge benefits” themselves: “My view is, if that’s a success, I question why we need to introduce a new form of money.” Bureaucrats push for the currency to exact more control over transactions – which would all be stored on a central ledger. Raising taxes would be easier than ever…
The Monetary Policy Committee of the Bank of England has voted to hold interest rates at 4.25%. After cutting from 4.5% last month…
Six voted for no change, three for a cut. Slowly slowly…
UPDATE: The Bank of England says in its report that “underlying UK GDP growth appears to have remained weak.“
Bank of England governor Andrew Bailey has just finished at the Treasury Select Committee where he was asked why, when the ONS’ growth figures look so promising for the Chancellor, BoE staff said in their latest report that underlying GDP growth was actually zero in the first quarter of the year. His answer was revealing:
“The challenge we have at the moment is that the forward-looking sort of evidence on activity in the economy so the surveys are nothing like as strong as that. So there is a disjoint if you like between that number and and and and the pattern we get from the surveys and the evidence.”
Guido has diligently covered surveys on confidence and projections from across the board. They do not paint a pretty picture…
Bailey points out the private figures are better than the ONS’ stats as a predictor:
“Surveys are probably a bet on average a better predictor of the future than the immediately previous GDP number… there’s a whole range… if you add them up… all the various surveys get around quite a lot of the economy.“
Businesses themselves are far from optimistic about Labour’s tax hikes and even less so when the Employment Rights Bill comes into play…
The Monetary Policy Committee of the Bank of England has voted to cut interest rates by 25 basis points to 4.25%. After holding at 4.5% last month…
“The MPC voted by a majority of 5–4 to reduce Bank Rate by 0.25 percentage points, to 4.25%. Two members preferred to reduce Bank Rate by 0.5 percentage points, to 4%. Two members preferred to maintain Bank Rate at 4.5%.” Interesting split…
The BoE notes: “underlying UK GDP growth is judged to have slowed since the middle of 2024, and the labour market has continued to loosen.” Tariff uncertainty weighing heavy on the analysis…
The Monetary Policy Committee of the Bank of England has voted to hold interest rates at 4.5%. After a cut last time round…
Prior to reaching 4.5% the rate was held at 4.75% following a cut from 5%. A jumpy path to cutting rates. As expected by markets in the face of ‘economic uncertainty’…
The MPC split was 8-1. Interesting when it comes to the prospects for future cuts…
UPDATE: The Bank’s explanatory notes go into more detail: “While UK GDP growth estimates have been slightly stronger than expected at the time of the February Monetary Policy Report, business survey indicators generally continue to suggest weakness in growth and particularly in employment intentions. In recent quarters, subdued activity has been judged to reflect both demand and supply factors.” Thanks Rachel…
Former Treasury minister and adviser to Burnham in the Makerfield campaign Lord Jim O’Neill, who has turned down a role in his government, said Burnham’s first statement Commons was:
“The last thing investors wanted to hear… gilt yields have risen by a 0.25% in one day, which is a lot. We’ve not had that since Liz Truss days… If your country is under the focus of ‘can they come up with a sensible fiscal strategy’ on a day when the markets think ‘well no, you’re not showing any sign of it’ you’re going to have a tough day…if it stays like this your mortgage rate is going up.”