Having reduced interest rates over the summer, the Bank of England last week confirmed it’s no longer planning to cut again. That’s a good call, not least because the original shift down was anyway a mistake.
After rates were reduced from 0.5pc to a record low of 0.25pc in August, following the UK’s referendum to leave the European Union, Bank Governor Mark Carney indicated they could fall even further. The Monetary Policy Committee now admits the UK economy is significantly stronger than it had expected in the wake of the Brexit referendum. Ergo, such “forward guidance” of even lower rates has expired.