, Columnist
Bank Of England Summons Up the Courage to Cut
But the next move probably won’t come until November.
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Confidence has broken out within the halls of the Bank of England: It’s decided to back its own forecasts — for once. A 25 basis point cut to 5% in its official rate Thursday was a close call, with a 5-4 split. It’s a lucky break for the new Labour government to spur its growth agenda, and certainly welcome for many parts of the economy that have struggled after 14 hikes and 515 basis points of tightening since December 2021.
Nonetheless, it was delivered as a cautious first step and not the start of an avalanche of easing; the guidance that the BOE won’t cut “too much or too quickly” suggests its next move won’t come until the November forecasts are in.