The Bank of England went ahead and raised rates as expected, saying that global growth was expected to be stronger than anticipated in the February Monetary Policy Report.
Consumer price inflation on the other hand remained likely “to fall sharply over the rest of the year”, the BoE said in its policy statement.
Bank Rate was hiked by 25 basis points to 4.25%.
The Monetary Policy Committee was seven to two in favour a hike, instead of the small majority anticipated by some economists in the City.
MPC member John Cunliffe, the deputy Governor for financial stability, voted for a hike, which some market commentary took as a vote of confidence in banks.
The Financial Policy Committee judged that the UK banking system’s capital position was “robust” and liquidity positions “strong”, the BoE said.
— More to follow —
