Share Prices & Company Research


07 November 2019

Interest rates and CPI remain the same

Today, the Bank of England’s Monetary Policy Committee (MPC) majority voted (7-2) to hold interest rates at the current 0.75%. The other two members, Jonathan Haskel and Michael Saunders, voted for a cut on the basis that “core inflation was subdued” and “persistent Brexit uncertainty” justified such an action. The BoE further stated that if growth remains weak, interest rates will have to be reduced further. Conversely, if growth begins to recover, as the Bank predicts, then interest rates will be pushed to counter inflation.
Meanwhile, September’s Consumer Price Index (CPI) remained at the current level of 1.7%, which is below the BoE’s target of 2%. This is expected to fall further, as the BoE is currently forecasting a CPI of 1.25% by spring 2020, given the reduction in energy and water prices. Meanwhile, labour costs have increased at a rate of 3.7% over the year, which could help counter the effects.
Interest rates and CPI remain the same
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