BoE unlikely to change rate policy

0.3% growth recorded in the first quarter

london — Don’t expect any change of heart among Bank of England policy makers just yet.

While the central bank will lift its 2017 inflation forecasts and lower its growth projections this week, according to economists surveyed by Bloomberg, that won’t transfer into more votes for an increase in interest rates. Just one policy maker is expected to dissent, with Kristin Forbes the likely candidate after she voted against her colleagues in March, citing the outlook for above-target inflation.

The Monetary Policy Committee, short a member after the resignation of Deputy Governor Charlotte Hogg in March, will announce its decision and updated economic projections at noon on Thursday in London. Governor Mark Carney will hold a press conference 30 minutes later, marking the first comments from an MPC member since the BoE went into pre-election purdah last month.

In March, some of the MPC majority said it might not take much more strength in either inflation or growth for them to also shift to Forbes’s view.

Yet while the BoE may raise its 2017 inflation forecast from 2.7 per cent in February, worse than expected growth will likely stay its hand. Gross domestic product increased 0.3 per cent in the first quarter, its worst performance in a year, and half the pace of the last three months of 2016.