Bank of England holds rates in 7-1 vote


The banks said it saw inflation rising and the economy growing steadily over the next few years.

The Bank of England has warned the squeeze from Brexit-fuelled inflation on household income has started and said growth would remain "moderate" after faltering at the beginning of the year.

In its quarterly Inflation Report, the Bank cut its forecast for 2017 economic growth very slightly from 2% to 1.9% but raised its projection for economic output next year and in 2019.

The BoE said it could only do so much to offset a Brexit hit to the economy, and Carney said the two-year process of leaving the European Union did not mean its hands were tied over monetary policy.

The FTSE 100 closed little changed yesterday, adding 1.39 points to end the session 0.09 percent higher at 7,386.63, following the Bank of England's (BOE) decision to leave rates unchanged.

Carney said the BoE had not made forecasts based on the scenario of a "disorderly Brexit" where Britain crashes out of the European Union without an agreement on future relations.

And while it nudged up its forecast for GDP growth in 2018 and 2019 by one-tenth to 1.7% and 1.8%, respectively, it warned that these projections assumed a "smooth" Brexit transition.

Bank of England governor Mark Carney. Although "inflation is forecast to remain above the MPC's target throughout the forecast period. this effect is expected to diminish towards the end of the forecast period".

Trump urges peace between Russian Federation and Ukraine
Moscow has denied any such interference and the Trump administration denies allegations of collusion with Russian Federation . That appears to be a reference to a New York Times report that Trump demanded loyalty from Comey at a January dinner.

Lanka-India Deals Signed Ahead Of Modi\'s Visit: Rajapaksa
He said Sri Lanka was "unlikely" to agree to China's request to dock the submarine at any time, given India's concerns. Language is not just a tool of communication but it also bonds and unifies cultures and people.

Manchester United have made an approach for Real Madrid forward Alvaro Morata
The Real Madrid star has been heavily linked with a move to the Premier League in recent months. Diego Costa's much-talked about move to China would only strengthen the possibility of that.

In the bank's summary of the MPC meeting, it noted that should Brexit negotiations proceed in an orderly fashion, interest rates could start to increase in response to rising inflation since the vote.

Price rises hit 2.3 per cent in March, and a weaker pound is set to keep the cost of living above the Bank's two per cent target during the next three years, said policymakers in today's report.

While the Bank said that it may need to raise interest rates before the late 2019 date it said was indicated by market pricing, that timeline was nine months later than that in its February forecasts.

At the time of writing, the Pound to Euro (GBP EUR) exchange rate was trading down at 1.1855 and the Euro to Pound (EUR GBP) exchange rate was trading up at 0.8434. The bank expects growth to be slower in the near term but pick up in the latter part of the forecast period as real income picks up. In particular, wage growth has been notably weaker than expected.

In the end, Forbes remained the sole dissenter with a resulting 7-1 split among policymakers (the committee is now one member short as Charlotte Hogg's seat has not been filled since her recent resignation). Rising inflation and poor income growth were cited as the main reasons for consumers feeling the squeeze; reflected in disappointing retail sales data and a surprisingly steep drop in new auto sales.

At the Monetary Policy Committee's last meeting, in March, Kristin Forbes voted for a rate hike and some other members were close to joining her.

"If the chance of a transitional deal does begin to materialize, it might well be that the Bank of England brings forward the point at which it raises interest rates, but at the moment, that doesn't appear to be on the cards".