The minutes from the 6-7th April MPC meeting showed that the Bank of England’s Monetary Policy Committee kept its 6-3 vote to keeping policy rates unchanged. The committee said that inflation expectations had not altered so much for them to change their view.
They said that near term inflation is likely to be higher than previously expected, due to higher energy prices, and significant risk that inflation will exceed 5 percent remained.
Committee members Sentance, Weale and Dale voted for a raise of the current rates. While Weale and Dale voted for a 25 bps rate hike, Sentance voted for a 50 bps increase. The MPC also voted to keep current asset purchases at £200B, with only Posen asking for an increase of the current quantitative purchases by £50B.
GBP/USD dropped to a day’s low of 1.6308 soon after the release of the minutes. EUR/GBP on the other hand rose to a day’s high of 0.8859.
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