Bank of England maintains 0.5% rate

At it’s meeting on 6th October, The Bank of England’s Monetary Policy Committee voted by a majority of 8-1 to maintain Bank Rate at 0.5%.

At the same time, the committee also voted unanimously to maintain the Asset Purchase Programme at £375Bn.

In August the 12 month CPI inflation was zero, well below the target 2%, with core inflation remaining at around one percent.

With inflation below the target, and the likelihood that at least some spare capacity remains in the economy, the MPC intends to set monetary policy so as to ensure that growth is sufficient to absorb any remaining under-utilised resources. That will support domestic cost growth and is necessary to ensure that inflation is on track to return sustainably to the 2% target rate within two years.

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