Bank of England cuts UK growth forecasts, holds rates

The Bank of England cut its economic growth forecasts today and left interest rates at a record-low, as policymakers fretted over slumping oil prices and the darkening global outlook.

After a two-day meeting, the BoE’s Monetary Policy Committee (MPC) held its key rate at 0.5 percent in a unanimous vote, where it has stood since March 2009 to stimulate commercial lending and foster economic growth.

The MPC also maintained the amount of cash stimulus, or quantitative easing (QE), pumping around the British economy at USD 542 billion.

With collapsing oil prices risking a new round of deflation, the MPC revised its growth outlook.

The British economy was set to expand by 2.2 percent this year, down from the previous November prediction of 2.5 percent, the BoE said in its latest quarterly forecasts.

The economy would then grow by 2.3 percent in 2017 and 2.4 percent in 2018. That was lower than prior guidance of 2.6 percent and 2.5 percent respectively.