As the Bank of England has reported:
The Monetary Policy Committee (MPC) sets monetary policy to meet the 2% inflation target, and in a way that helps to sustain growth and employment. The MPC adopts a medium-term and forward-looking approach to determine the monetary stance required to achieve the inflation target sustainably.
At its meeting ending on 7 May 2025, the MPC voted by a majority of 5–4 to reduce Bank Rate by 0.25 percentage points, to 4.25%. Two members preferred to reduce Bank Rate by 0.5 percentage points, to 4%. Two members preferred to maintain Bank Rate at 4.5%.
That's too little.
It's too late.
It should have been 0.5% now with an indication of three more cuts of a similar amount this year, instages simply to allow market adjustment.
As it is, the Bank continues to encourage stagflation, recession, and even depression if that hits the States, as it still might as a result of Trump.
The Bank of England is its own worst enemy, and ours too.
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I get the impression there are particular members of the BoE committee that have a very US-centric view and who almost never support a reduction in rates. Both Catherine L Mann (in 30 votes only voted for a decrease once), and Huw Pill (in 30 votes only voted for a decrease twice) have a clear preference for higher rates (Mann more than Pill as 18/30 times she’s voted for an increase).
Mann and Pill have strong ties with the US, and it’s hard not to suspect that they’re that much further removed from the economic hardship facing many households in this country, and that they are not, therefore, votes that represent the needs or interests of England.
It’s also worth noting that on the minutes data the stock of government bond purchases shows the last review was September 2024 where there was an agreement to reduce the stock held by £100bn comprised of maturing gilts and sales, and noting there would be a high bar to changing the planned reduction outside of the annual review. That combines with the 1.65% Real (i.e. above-CPI inflation) interest rate to put strain on the economy.
Thanks
And all this, with not a peep out the real managers of interest rates – government ministers – who were voted in by those the BoE is hurting.
Why do voters vote for self-abuse? That’s not a democracy.