The Central Bank of England announced its decision on monetary policy for March 2025 and was as follows:
- Fixing the interest rate at the levels of 4.50%.
- The result of the vote on the bank interest rate was 8-1, while the forecast was 7-2.
- We have seen significant progress in reducing inflation.
- This progress allowed to gradually roll back the restrictions of monetary policy while maintaining its restrictive character.
- The uncertainty on World Trade Policy has increased since the last policy meeting. - Geopolitical uncertainties have increased.
- Indicators of financial market volatility have increased globally.
- Indicators still point to weak growth.
- A gradual and cautious approach to further rollback of monetary policy restrictions is appropriate.
- If inflation pressures decrease, this calls for a less restrictive course of the bank interest rate.
- But if there are side effects associated with high inflation in the near term, then this calls for a relatively tighter course of monetary policy.
- Monetary policy will need to continue to be restrained long enough for inflation risks to return.
- The efforts of the British central bank to continue to achieve the 2% target in the medium term have been further dissipated.
