Monetary policy has been left unchanged for another month, meaning Base interest rate remains 0.25% (with a capped QE programme). Inflation was up to 2.9% in April and May but dropped to 2.6% during June. The consensus amongst analysts is that a rate rise is unlikely for the remainder of the year.
According to the Bank’s agent scores, based on ‘intelligence gathered from business contacts between June and mid-July’; ‘consumer spending had eased slightly further in values terms, manufacturing output growth had risen again… the market for new homes remained stronger overall than the secondary market, supported by Help to Buy’ and ‘investor demand for commercial real estate had continued to increase’. Additionally, ‘occupier demand remained resilient and vacancy rates generally remained low’.
Whatever the Bank decides, some lenders have already been altering their interest rates in an upward trajectory and, due to Prudential Regulation (part of the BoE), Portfolio Landlords be facing additional restrictions from rental coverage and values, for borrowing.