BOE Spring
  • Prior 5.25%
  • Bank rate vote 8-0-1 vs 7-1-1 expected (Dhingra voted to cut rates by 25 bps)
  • Moving in the right direction but not yet at the point to cut interest rates
  • Inflation has continued to fall back relatively sharply
  • Restrictive monetary policy stance is weighing on activity in the real economy
  • That is leading to a looser labour market and is bearing down on inflation pressures
  • But key indicators of inflation persistence remain elevated
  • Monetary policy will need to remain restrictive for sufficiently long to return inflation to the 2% target
  • Prepared to adjust monetary policy as warranted by economic data to return inflation to the 2% target sustainably
  • Will keep under review for how long Bank Rate should be maintained at its current level
  • Full statement

It is pretty much the status quo as the language in the statement is more or less a copy of that in February. The pound is lower though as the bank rate votes have changed. Last month, Haskel and Mann voted for 25 bps rate hikes but have now voted to keep the bank rate unchanged instead. It provides traders with more comfort of a rate cut in August but that's about it I'm afraid.

GBP/USD is down slightly from 1.2745 to 1.2725 initially on the decision, now at 1.2735 - down 0.4% on the day.