Bank of England keeps rates unchanged

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Bank of England Decision

The Bank of England 🏦 decided to keep its main interest rate steady at 5.25% on Thursday, as many experts predicted. This decision comes despite recent signs that inflation in the UK is slowing down.

Committee Vote

In a vote by the Monetary Policy Committee, 7 members supported maintaining the rate, while 2 members wanted to lower it to 5%. This reflects ongoing discussions about how to manage economic pressures.

Economic Context

Recent data showed that consumer inflation in May was 2.0%, which matches the Bank's target for the first time in almost three years. 📉 However, concerns about wage growth and other underlying economic factors remain.

Future Outlook

Bank of England Governor Andrew Bailey hinted at a possible rate cut earlier, but recent data hasn't been strong enough to confirm this move. Economists expect a potential rate cut in August, with markets showing a 30% chance of it happening by then.
 

Market Reaction

Following the announcement, the British pound 🇬🇧 weakened slightly against the dollar 💵, while the 2-year Gilt yield, a measure of UK government bond returns, saw a slight increase. The FTSE100 index also saw a modest rise.

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