- Mark Carney, BoE Governor
The vote of the MPC remained unchanged in December, with the majority of policy makers believing that weak inflation outlook warranted maintaining interest rates intact at all-time low of 0.5%. The BoE officials, however, voted unanimously to keep the size of its asset purchases unchanged at 375 billion pounds. Martin Weale and Ian McCafferty reiterated their call for a lift in the benchmark rate to 0.75% to keep a lid on future inflationary pressures. Earlier in the week, the Bank of England Governor Mark Carney said the UK economy could benefit from the recent slump in oil prices, which is seen boosting consumers' spending power and supporting the global demand. Meanwhile, the majority on the board concluded that subdued pay growth, plunging commodity prices are likely to keep inflation weak. Inflation was likely to fall below 1% in December, far below the BoE 2% goal, and stay lower than previously estimated, officials said. British inflation unexpectedly fell to 1% in November, the lowest level in more than 12 years. In the meantime, the UK's unemployment rate remained steady at 6.0% against analysts' expectations of a decline to 5.9%, as wages continued to climb and the number of people seeking unemployment benefit dropped more than expected, according to the Office for National Statistics. Total pay including bonuses rose by 1.4%, compared with last month's 1% rise. Regular pay, which strips out bonuses, climbed in line with expectations by 1.6%.
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