BoE makes surprise 50bp rate increase
Central bank to review modelling framework after repeated forecast errors
The Bank of England raised its policy rate 50 basis points today (June 22), a larger move than most analysts expected, as inflation threatens to overshoot the central bank’s forecast again.
Policy-makers voted 7–2 to increase the rate to 5%. As in other recent meetings, Swati Dhingra and Silvana Tenreyro voted to keep rates unchanged.
The decision came a day after the latest data showed inflation in the UK remains stubbornly high. The headline consumer price index rose 8.7% year on year in May
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