UKX FTSE 100 Index

By WSJ City 

The Bank of England left its key interest rate unchanged at 0.75%, and reiterated its expectation that tighter policy will be needed in the years to come.

KEY FACTS

--- The BOE said investors expected a very gradual tightening--just one rate rise to 1% by 2021.

--- But it suggested more action may be needed...

--- ...since it forecast that inflation will be rising above its target in 2021 if rates have risen just once.

--- The BOE also raised its growth forecasts for the coming years.

Why This Matters

The decision to hold interest rates was "no great surprise," notes Richard Carter, head of fixed-interest research at asset manager Quilter Cheviot. That's because the outcome of Brexit, which has huge ramifications for the UK economy, is still uncertain. "There is an outside chance that they will decide to increase rates later this year given the tight labour market and recent pickup in wage growth," Carter adds.

A fuller story is available on WSJ.com

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(END) Dow Jones Newswires

May 02, 2019 08:47 ET (12:47 GMT)

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