UK Monetary Policy Unchanged in December


At its December 5th meeting, the Bank of England Monetary Policy Committee decided to leave its bond-buying programme unchanged at 375 billion pounds, as widely expected. The official Bank Rate paid on commercial bank reserves was also kept at 0.5 percent.

The Committee reached its decisions in the context of the monetary policy guidance announced alongside the publication of the August 2013 Inflation Report.

Under the leadership of Mark Carney, the Bank of England has said it will not think about raising rates until the unemployment rate falls to 7 percent. Yet, policymakers stressed that 7 percent is a "threshold" and not a "trigger".

In September, the jobless rate in the UK fell to 7.6 percent, the lowest level in 4-1/2 years.  
The economy accelerated further in the third quarter for the third consecutive period and expanded 0.8 percent qoq, overtaking its euro zone peers. 

The central bank decision came shortly after finance minister George Osborne announced an upward revision to official growth estimates. The GDP is expected to expand 1.4 percent in 2013, up from 0.6 percent pointed earlier in March. In 2014, the economy is expected to rise 2.4 percent, up from the previous estimate of 1.8 percent.

UK Monetary Policy Unchanged in December


BoE | Joana Taborda | joana.taborda@tradingeconomics.com
12/5/2013 12:27:32 PM