The Bank of England confirmed to keep the interest rate steady

In early February, the financial market was particularly focused on the Bank of England’s Monetary Policy Committee meeting. Analysts at Tickmill Group, including Patrick Munnelly, predicted that the base interest rate would remain unchanged, confirming the monetary stability expectations that characterized the period.

Market Expectations for the Base Rate

According to data from LSEG, the probability that the Bank of England would keep the interest rate at 3.75% was very high, at 97%. This level of consensus highlights how the market was largely convinced of a monetary policy aimed at maintaining the status quo. Patrick Munnelly of Tickmill Group anticipated a vote of seven committee members in favor of the unchanged rate, while only two might have voted for a 25 basis point reduction, a scenario that did not materialize as expected.

Committee Vote and Economic Implications

The decision by the Monetary Policy Committee reflects the Bank of England’s cautious approach in a complex economic environment. Keeping the interest rate at this level signals the central bank’s determination to preserve monetary stability and control inflation, avoiding cuts that could further weaken the British currency. The convergence of opinions among analysts and the strong probability calculated by LSEG indicated a decision already widely anticipated by the markets, thus minimizing any surprise impact on the exchange rate and overall financial markets.