Bank of England keeps the standstation rates of 4.5%

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The Bank of England has retained interest rates at 4.5 %, while leaving the door open for further reductions this year, as it deals with global trade tensions and constant prices in the UK.

The Central Bank’s Monetary Policy Committee voted eight on one to leave its rate unchanged as it repeated plans to implement a “gradual and careful” approach to more reductions.

Swati Dhingra, an external member of MPC and the longtime pigeon, voted to cut rates at a quarter point.

“At the moment there is a lot of economic uncertainty,” said Andrew Bailey, Bo’s governor. He added that while the bank had a rate of 4.5 %, “we still think the interest rates are on a gradual decline on the road.”

The Bo Facing a delicate act of balancing in the coming months, as measures evidence of economics and weakens the job market against the prospect of pickup in inflation.

This week’s minutes at the meeting opened the possibility of reducing the rate when the MOC is convened in May, but did not give a strong signal of the likelihood of a move.

“There is no assumption that monetary policy is on a pre -set track over the next few meetings,” the minutes said. The MOC added that it is focused not only on whether the increase in global and domestic uncertainty will weigh demand, but also if the UK and prices can prove more persistent than they expected.

The decision on Thursday followed a quarter-point reduction last month, when Boe also halved its growth estimate from 2025 to 0.75 %.

“We consider very carefully how the global and domestic economies are developing at each of our six -week rate settings,” Bailey said. “Whatever happens, our job is to make sure that inflation remains low and stable.”

The Central Bank believes that inflation of the consumption price will accelerate to 3.75 % later this year compared to 3 % in January – far above the target of 2 %.

But research from the BOE agent network published on Thursday has shown more companies reporting that they are freezing employment and potentially preparing to cut jobs if Britain’s growth fails to collect.

“The Bank of England is stuck between a rock and a hard place with inflationary pressures that are increasing along with the poor growth of growth,” said Zara Knox, an analyst at the Global Market in JPMorgan Asset Management.

The union of uncertainties is signs of increasing economic damage from US President Donald Trump’s trade war and the prospect of reducing costs in the spring statement next week by Chancellor Rachel Reeves.

Kumara, a TD securities strategist, said Reeves’ statement poses a significant risk. “Further reduction of government costs (suggests) a serious picture of growth in the UK,” Kuma said. “It should support at least the quarterly pace of reducing the rate of BOE.”

The MOC is concerned that the job market is getting worse, but has also become more pessimistic about the rate at which the UK economy can rise without preventing prices.

Figures released earlier on Thursday showed Wage growth remains strongAt an annual rate of 5.9 % for three months to January, with the exception of bonuses.

But research on business activities by BOH agents highlighted trends in weakening of the labor market.

“Employment intentions have turned negative from the last round, with more companies reporting that they pause or freeze employment and say they may seek to watch jobs if the prospects are not improving,” the agent report said.

The likelihood of lowering the interest rate in May dropped slightly under 50 %, about 60 % before BOE’s decision and the release of the record, according to the level of SWAPS markets. Traders continued to expect two reductions in the whole by the end of the year.

Catherine Mann, an external member of the MOC, who voted to reduce the rate to half points in February, fell to most of the committee in deciding to keep the footsteps unchanged to 4.5 %.

The yield of two -year -old rate residents rose to 4.26 %, low by 4.15 % earlier in the day.

The pound fell 0.3 % to $ 1,296 compared to a widely stronger dollar.