Expert comment: Bank of England holds base interest rate
In reaction to the Bank of England holding the base interest rate at 4.25% today, the University of Salford Economist, Dr Maria Paola Rana, shares her thoughts. Maria comments:
“Unsurprisingly, the Monetary Policy Committee (MPC) of the Bank of England has today kept the base interest rate cautiously at 4.25%. The decision was largely anticipated after yesterday’s news that inflation was higher than expected at 3.4% in May, with food prices soaring, as well as an expected increase in oil prices due to the conflict in the Middle East and Trump's tariffs.
“The vote was more divided than expected. The signals of the labour market with lower wage growth and increasing unemployment should be considered, in what is a difficult balance between stimulating the economy and controlling inflation.
“So, no good news today, but there is wide expectation that the rate will be cut in August, when less uncertainty is expected.”
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