The Bank of England is finally signaling that it may have done enough to tame inflation, writes ITV News' Economics Editor Joel Hills | ITV National News
First thing to note: it was a close call.
Andrew Bailey, the Governor, proposed to maintain Bank Rate at 5.25%. Four members of the Monetary Policy Committee voted with him.Until now, the Bank has expressed three reasons for increasing interest rates. The tightness of the labour market; the strength of pay growth; and the rate of inflation in the Services sector of the economy .Unemployment has begun to rise, employment is edging down along with the number of vacancies in the economy.
Pay growth in the private sector is still running above 8% but survey data elsewhere tells a story of falling wage inflation and most MPC members seem inclined to believe it.. The Bank had expected it to rise to 7.1% in August, instead it fell to 6.8%. The headline rate of inflation is edging down and the majority of the MPC believes that the evidence - which is not conclusive - suggests there are reasons to believe we are now seeing a broad-based and sustainable slowdown in price rises.
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