Despite the drop in U.K. inflation, the Bank of England (BOE) maintained interest rates at 5.25%.
Euronews reported on the 20th (local time) that the BOE decided on monetary policies in line with the market expectations and maintained the interest rate for the seventh consecutive time.
Although the possibility of a decrease was raised as the U.K.’s consumer price index (CPI) for May hit the 2% target, the Monetary Policy Committee members remained cautious.
Among the seven members of the Monetary Policy Committee, only two suggested a 0.25% point decrease, while the rest supported the freeze.
Andrew Bailey, the Governor of the BOE, explained that freezing at 5.25% is due to the necessity to consistently keep inflation low.
The BOE predicts that inflation will rebound in the latter half of this year.
According to Sky News, following this Monetary Policy Committee meeting, the market sees a 44% chance of the BOE lowering interest rates in August and a 71% in September.
