The Bank of England confirmed a widely-expected hold in interest rates following its May meeting on Thursday.
LONDON — The Bank of England on Thursday announced a widely-expected hold on interest rates as it said restrictive monetary policy was taming inflation, but warned a June rate cut was not a done deal.
The MPC nonetheless cautioned that indicators of inflation persistence"remain elevated," highlighting that services inflation came in at 6% in March, and that there are"upside risks" to the near-term outlook from geopolitics. Market anticipation has been building for interest rate cuts to begin in the summer, with money markets fully pricing in a 25 basis point reduction in August and 50 basis points overall this year.
It meanwhile sees headline inflation close to 2% in the near-term, and expects it to increase slightly later in the year as the drag from the energy market wanes.
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