BoE Interest Rate Decision

Bank of England Interest Rate Decision is one of the key indicators affecting the pound sterling quotes. The decision is adopted by the BoE Monetary Policy Committee (MPC).

Monetary Policy Committee meets eight times a year to determine the national monetary policy and to set the interest rate. Each meeting lasts three and a half days. On the first day, the Committee members study the current economic disposition (both the internal agenda and the state of the world economy, the main events that affect the financial and economic conditions). On the second day, members discuss their view on the current national monetary policy. On the third day, members vote on the monetary policy measures and the interest rate.

The Committee interest rate decision is published the next day, at 12 noon. Meeting minutes are published on the Bank of England’s website alongside the interest rate decision.

The BoE may cut interest rate to help inflation rise to a target level. Conversely, if inflation exceeds the target level, the BoE would try to make the pound sterling more expensive, for which (in addition to a complex of other measures) the interest rate is raised.

Therefore, each interest rate decision of the Bank of England directly affects the quotes of the pound sterling (especially when the rate is changed). A hike decision normally leads to the growth of the British pound quotes.