The Bank of England’s (BoE) decision to cut its policy rate by 25bp to 5.00% was a close call, Rabobank’s senior macro strategist Stefan Koopman notes.

No rapid succession of cuts

“BoE’s decision to cut its policy rate by 25bp to 5.00% was a close call. The vote was split 5-4 and the decision was again ‘finely balanced’ for some members. The split implies no rapid succession of cuts. Governor Bailey added a hawkish element to the vote, saying the MPC will be careful not to cut interest rates too quickly or too much.”

“The rate cut was accompanied by encouraging changes in economic forecasts. We continue to anticipate a cut per quarter going forward, as we did prior to this meeting, with the next move forecasted for November.”