BoE to remain on hold for the foreseeable future – Wells Fargo

Next Thursday, the Bank of England will announce its decision on monetary policy. No change in rates is expected, particularly after the results of the general election in the United Kingdom. According to analysts at Wells Fargo, the central bank will remain on hold for the foreseeable future. 

Key Quotes: 

“The Bank of England (BoE) announces its latest monetary policy decision next week and is widely expected to hold its bank rate steady at 0.75%. In its November announcement, the BoE held rates steady but two officials unexpectedly voted for a rate cut. The committee’s comments following the announcement suggest it is split on the next monetary policy action.”

“Price pressures eased in October, as U.K.’s headline CPI figure rose just 1.5% year-over-year, dipping to a near three-year low, while core CPI inflation held steady at 1.7% year-over-year, still below the central bank’s 2% target. Meanwhile, U.K. GDP stagnated in October, suggesting a slow start to the fourth quarter. Given the soft inflation and growth figures, combined with some uncertainties on longer-term E.U.-U.K. trade talks now that the Conservative party secured a majority in Parliament, we expect the BoE to remain on hold for the foreseeable future.”