BOE hikes policy rate by 75 bps to 3% as expected

Following its November policy meeting, the Bank of England (BoE) announced that it raised the policy rate by 75 basis points (bps) to 3%. Policymakers voted 7-2 in favour of this decision. One policymaker voted for a 25 bps hike and one voted for a 50 bps.

Bank of England (BoE) Governor Andrew Bailey is delivering his remarks on the policy outlook and responding to questions from the press following the bank’s decision.

“We maybe have the largest upside risk in inflation forecasts in MPC history.”

“We do think the market curve is too high.”

“Where the truth lies in between constant rate and market rate paths, we don’t predict.”

“There has been a questioning of UK policy.”

“That will have some lasting effect.”

“We will have to work hard to repair it.”

“Rates on fixed term mortgages should not need to rise as they have done.”

“This downturn dampens domestic inflationary pressure.”

“MPC will not pursue a path that we think will drive inflation far below target.”

“MPC does not follow the market.”

“Publication of constant rate forecasts do not mean MPC expects to keep bank rate constant either.”

“Regardless of path of bank rate, MPC judges risk to inflation projections skewed to upside.”