At its latest quarterly meeting the IEA Shadow Monetary Policy Committee (SMPC) voted narrowly to cut UK Bank Rate on Thursday 7th February. Five SMPC members voted to cut the official interest rate, while four members voted for rates to remain on hold.
As happened last month, the rate cutters were not unanimous, with four wanting a 0.25% reduction, and one a cut of 0.5%. The result was a decision in favour of a 0.25% cut. Looking further ahead, the four people who wanted to cut rates by 0.25% had a neutral bias thereafter, but the one who wanted to cut rates by 0.5% and one of the ‘holds’ had a subsequent bias to ease. Two of the people who wished to hold had a neutral bias, and one ‘hold’ had a bias to tighten.
