BANK OF ENGLAND HOLDS

The Bank of England held interest rates steady at their record low of 0.25% on Thursday, after the first meeting of the bank's Monetary Policy Committee since its historic rate cut in August.

At the Old Lady of Threadneedle Street's first Monetary Policy Committee meeting since it launched its post-Brexit stimulus package on August 4, governor Mark Carney and the other eight members of the committee decided that taking Britain's interest rate closer to zero once again is not yet the best course of action to mitigate the economic risks posed by the UK's decision to leave the EU.

After just over a month of the central bank's new monetary policy measures, which included an extensive new programme of quantitative easing alongside the rate cut, it was always highly unlikely that Carney and the rest of the MPC would decide to take any new action this month. Of all the economists and forecasters Business Insider spoke to prior to the decision, not a single one saw any new policy moves on Thursday.

The Monetary Policy Committee voted unanimously in favour of leaving the bank's base rate at 0.25%. It also voted 9-0 in favour of leaving its QE programme unchanged at a total of £435 billion.

However, the bank once again signalled that it is likely to cut interest rates again later in the year, with minutes from the meeting showing that if the UK economy's performance is in line with the bank's August projections "a majority of members expect to support a further cut in Bank Rate to its effective lower bound at one of the MPC's forthcoming meetings during the course of this year."

Market expectations seem to be that the bank will cut to 0.1% in November, but not much lower, especially seeing as numerous MPC members have almost entirely ruled out taking interest rates into negative territory. Carney himself effectively drew a line in the sand in August, saying: "We're not intending to move to negative interest rates. At least, I'm not intending to move to negative interest rates."

The MPC also acknowledged that in recent weeks, economic data coming out of the UK has been substantially stronger than expected, noting: "Nevertheless, since the August Inflation Report, a number of indicators of near-term economic activity have been somewhat stronger than expected. The Committee now expect less of a slowing in UK GDP growth in the second half of 2016." It did not provide an exact forecast on what "less of a slowing" means in numerical terms.

The Bank of England also took time to pat itself on the back for the effectiveness of the measures introduced in August, saying that they'd performed their role slightly better than expected.

"The package of measures announced by the Committee at its August meeting led to a greater than anticipated boost to UK asset prices. Short and long-term market interest rates fell notably following the announcement; corporate bond spreads narrowed, and issuance was strong; and equity prices rose. Since then, some of the falls in yields have reversed, driven by somewhat stronger-than-expected UK data and a generalised rise in global yields," a release from the BoE noted.

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