United Kingdom Interest Rate  1971-2017 | Data | Chart | Calendar

The Bank of England voted by five to three to keep the Bank Rate at a record low of 0.25 percent on June 15th, 2017, as widely expected. Policymakers showed concerns over rising inflation and slow pay growth and the effects on household spending and GDP. The Committee voted unanimously to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £10 billion. The Committee also voted unanimously to keep the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £435 billion. Interest Rate in the United Kingdom averaged 7.71 percent from 1971 until 2017, reaching an all time high of 17 percent in November of 1979 and a record low of 0.25 percent in August of 2016.

United Kingdom Interest Rate
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Calendar GMT Actual Previous Consensus Forecast (i)
2017-05-11 11:00 AM BoE Quantitative Easing £435B £435B £435B £435B
2017-06-15 11:00 AM BoE Quantitative Easing £435B £435B £435B £435B
2017-06-15 11:00 AM BoE Interest Rate Decision 0.25% 0.25% 0.25% 0.25%
2017-06-27 08:30 AM BoE Financial Stability Report
2017-07-04 08:30 AM BoE FPC Minutes
2017-08-03 11:00 AM BoE Interest Rate Decision 0.25% 0.25%




BoE Leaves Key Rate At 0.25%


The Bank of England voted by five to three to keep the Bank Rate at a record low of 0.25 percent on June 15th, 2017, as widely expected. Policymakers showed concerns over rising inflation and slow pay growth and the effects on household spending and GDP. The Committee voted unanimously to maintain the stock of sterling non-financial investment-grade corporate bond purchases, financed by the issuance of central bank reserves, at £10 billion. The Committee also voted unanimously to keep the stock of UK government bond purchases, financed by the issuance of central bank reserves, at £435 billion.

Excerpts from the BoE Monetary Policy Summary:

CPI inflation has been pushed above the 2% target by the impact of last year’s sterling depreciation. It reached 2.9% in May, above the MPC’s expectation. Inflation could rise above 3% by the autumn, and is likely to remain above the target for an extended period as sterling’s depreciation continues to feed through into the prices of consumer goods and services. The 2½% fall in the exchange rate since the May Inflation Report, if sustained, will add to that imported inflationary impetus.

In contrast, pay growth has moderated further from already subdued rates, even as the unemployment rate has fallen to 4.6%, its lowest in over 40 years.

GDP growth declined markedly in the first quarter, in part reflecting weaker household spending. It remains to be seen how large and persistent this slowdown in consumption will prove. In recent months, there have been further signs of a slowing housing market and new car registrations have fallen sharply. Consumer confidence has remained relatively resilient, however, and employment has continued to rise. Outside the household sector, export indicators have strengthened, probably reflecting both the depreciation of sterling and increasingly robust global demand.  Most surveys of investment intentions have remained above their historic averages. Surveys of general business activity suggest a modest recovery in GDP growth in the second quarter.

Monetary policy cannot prevent either the necessary real adjustment as the United Kingdom moves towards its new international trading arrangements or the weaker real income growth that is likely to accompany that adjustment over the next few years. Attempting to offset fully the effect of weaker sterling on inflation would be achievable only at the cost of higher unemployment and, in all likelihood, even weaker income growth.  For this reason, the MPC’s remit specifies that, in such exceptional circumstances, the Committee must balance any trade-off between the speed at which it intends to return inflation sustainably to the target and the support that monetary policy provides to jobs and activity.

The projections that the Committee published in May showed that the economy was expected to operate with a small degree of spare capacity for most of the three-year forecast period, justifying the tolerance of some degree of above-target inflation. The continued growth of employment could suggest that spare capacity is being eroded, lessening the trade-off that the MPC is required to balance and, all else equal, reducing the MPC’s tolerance of above-target inflation. Looking ahead, key considerations in judging the appropriate stance of monetary policy are the evolution of inflationary pressures, the persistence of weaker consumption and the degree to which it is offset by other components of demand.
In light of these considerations, five members thought that the current policy stance remained appropriate to balance the demands of the MPC’s remit. Three members considered it appropriate to increase Bank Rate by 25 basis points. All members agreed that any increases in Bank Rate would be expected to be at a gradual pace and to a limited extent. The Committee will continue to monitor closely the incoming evidence, and stands ready to respond to changes in the economic outlook as they unfold to ensure a sustainable return of inflation to the 2% target.

BoE | Joana Taborda | joana.taborda@tradingeconomics.com
6/15/2017 11:28:19 AM



United Kingdom Money Last Previous Highest Lowest Unit
Interest Rate 0.25 0.25 17.00 0.25 percent [+]
Interbank Rate 0.30 0.30 15.63 0.29 percent [+]
Money Supply M0 82064.00 81842.00 82064.00 3529.00 GBP Million [+]
Money Supply M1 1654414.00 1641919.00 1654414.00 82307.00 GBP Million [+]
Money Supply M2 1648754.00 1643309.00 1648754.00 114632.00 GBP Million [+]
Money Supply M3 2724031.00 2703241.00 2724031.00 262939.00 GBP Million [+]
Banks Balance Sheet 3765318.00 3754432.00 4060273.00 3342179.00 GBP Million [+]
Central Bank Balance Sheet 405132.00 404299.00 414839.00 77638.00 GBP Million [+]
Foreign Exchange Reserves 153973.88 152448.49 153973.88 35190.42 USD Million [+]
Loans to Private Sector 2320407.00 2257615.00 2813077.00 8755.00 GBP Million [+]
Deposit Interest Rate 0.00 0.00 4.25 0.00 percent [+]
Private Debt to GDP 230.45 224.96 241.34 153.37 percent [+]


United Kingdom Interest Rate Notes

In the United Kingdom, benchmark interest rate is set by the Monetary Policy Committee (MPC). The Bank of England official interest rate is the repo rate. This repo rate applies to open market operations of the Bank of England with a group of counterparties (banks, building societies, securities firms). This page provides - United Kingdom Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. United Kingdom Interest Rate - actual data, historical chart and calendar of releases - was last updated on June of 2017.

Actual Previous Highest Lowest Dates Unit Frequency
0.25 0.25 17.00 0.25 1971 - 2017 percent Daily



interest rate by Country

Last
Brazil 10.25 May/17
Russia 9.00 Jun/17
Turkey 8.00 Jun/17
Mexico 7.00 Jun/17
India 6.25 Jun/17
Indonesia 4.75 Jun/17
China 4.35 Jun/17
Australia 1.50 Jun/17
South Korea 1.25 May/17
United States 1.25 Jun/17
Canada 0.50 May/17
United Kingdom 0.25 Jun/17
Euro Area 0.00 Jun/17
France 0.00 Jun/17
Germany 0.00 Jun/17
Italy 0.00 Jun/17
Netherlands 0.00 Jun/17
Spain 0.00 Jun/17
Japan -0.10 Jun/17
Switzerland -0.75 Jun/17