Bank of England meeting —

At its 15 June 2022 meeting, the Bank of England raised its policy rate from 0.50% to 1.25%. The decision passed 6-3.

Decision

hike — 0.50% to 1.25%

Vote: 6-3

Key passages

At its meeting ending on 15 June 2022, the MPC voted by a majority of 6-3 to increase Bank Rate by 0.25 percentage points, to 1.25%. Those members in the minority preferred to increase Bank Rate by 0.5 percentage points, to 1.5%.

Three members wanted a larger hike, signalling strong concern about inflation.

CPI inflation was expected to average slightly over 10% at its peak in 2022 Q4. Conditioned on the rising market-implied path for Bank Rate at that time and the MPC’s forecasting convention for future energy prices, CPI inflation was projected to fall to a little above the 2% target in two years’ time, largely reflecting the waning influence of external factors, and to be well below the target in three years, mainly reflecting weaker domestic pressures. The risks to the inflation projection were judged to be skewed to the upside at these points.

Inflation falls below target in three years but risks are upside — the path is uncertain and could require tighter policy.

Meeting documents

Background reading

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