PANews August 7th news, according to Jinshi reports, the Bank of England reiterated its guidance, stating that it will take a 'gradual and cautious approach' to further reducing borrowing costs, but added a new clue in its information about the outlook, suggesting that its rate-cutting actions may soon come to an end. The Bank of England stated, 'As interest rates are lowered, the restrictiveness of monetary policy has decreased,' and no longer directly indicated that the policy remains restrictive. The Bank of England reiterated that there is no predetermined path for interest rates. The halt in the rate-cutting process will be a blow to Chancellor Reeves and Prime Minister Starmer, who have been striving to fulfill their commitments to voters to accelerate the UK's sluggish economic growth. Bailey stated that the decision to cut rates for the fifth time since last August was 'very balanced,' although he believes that interest rates are still on a downward path.
It is reported that four out of nine decision-makers sought to maintain borrowing costs unchanged due to concerns about high inflation. Due to difficulties in reaching a consensus, the UK's Monetary Policy Committee had to hold two interest rate votes for the first time in its history. The Monetary Policy Committee is divided on how to respond to the inflation rate (which the Bank of England predicts will soon be double its 2% target) and the recently worsening unemployment issue. Governor Bailey and four colleagues supported lowering the interest rate from 4.25% to 4%. The four members who supported keeping the interest rate unchanged include Deputy Governor Lambardelli, who departed from the majority position for the first time, and Chief Economist Pill, who also voted to keep the rate at 4.25%.