The Bank of England (BoE) announced its Monetary Policy Committee (MPC) voted 9-0 to maintain Bank Rate at 0.1 percent at its September meeting, as widely expected.

The MPC also voted unanimously to continue with its existing programmes of UK government bond and sterling non-financial investment-grade corporate bond purchases, maintaining the target for the total stock of these purchases at £745 billion.

In its statement, the BoE notes:

• Outlook for economy remains unusually uncertain; direct impact of Covid-19 on economy would dissipate gradually
• Sterling exchange rate index has fallen by around 2%, in part reflecting recent Brexit developments
• Consumption has continued to recover during the summer and is now at around its start-of-year level in aggregate, stronger than expected in August
• Number of paid employees has fallen by around 700,000 between February and August
• Investment intentions have remained very weak and uncertainties among businesses are elevated
• For Q3, Bank staff expect GDP to be around 7% below its 2019 Q4 level, less weak than had been expected in August.
• CPI inflation is expected to remain below 1% until early 2021, albeit slightly higher than expected in August
• Path of growth and inflation will depend on the evolution of the pandemic and measures taken to protect public health, as well as the nature of, and transition to, new trading arrangements between EU and UK; it will also depend on responses of households, businesses and financial markets to these developments
• Recent domestic economic data have been little stronger than Committee expected in August
• Recent increases in Covid-19 cases have potential to weigh further on economic activity, albeit probably on lesser scale than seen earlier in the year
• Committee will continue to monitor situation closely and stands ready to adjust monetary policy accordingly to meet its remit.
• MPC will keep under review range of actions that could be taken to deliver its objectives
• Committee does not intend to tighten monetary policy until there is clear evidence that significant progress is being made in eliminating spare capacity and achieving the 2% inflation target sustainably
• Committee judged that existing stance of monetary policy remains appropriate.