Bank of England cuts base rate to 3.75%, in ‘keep calm, and carry on’ decision

The Bank of England’s Monetary Policy Committee has followed the lead of the US Federal Reserve last week and cut interest rates by 25 basis points. However, it was a surprisingly close vote – five in favour versus four against, with the Governor, Andrew Bailey, exercising his casting vote. It is interesting to note that despite a run of disappointing news on the UK economy in recent weeks, the MPC does not appear spooked. The tone of its press statement that accompanied the decision, and thus its message to the financial markets and households, was decidedly ‘keep calm, and carry on’.