BoE Holds Interest Rates

London: 14 December 2023 (TraderMade): The Bank of England kept its hawkish grip on interest rates. The central bank kept the interest rates unchanged at a 15-year high of 5.25%. This move comes amid growing signs of economic distress.

Six policymakers stood firm, prioritizing inflation control over a weakening economy. However, the central bank acknowledged the potential need for future tightening, leaving the door open for further action against persistent inflation.

This hawkish stance clashed with investor expectations, fueled by recent data showing a surprise GDP dip and a swifter-than-expected slowdown in wage growth. Markets now whisper of potential cuts by December 2024, with some predicting a drop to around 4.0%.

The BoE's next move remains a tightrope walk. While committed to taming inflation, they must navigate a deteriorating economic landscape. The December decision may be firm, but the future whispers of potential cuts.