The Bank of England, on the whole, doesn’t like to spring surprises. A surprise usually betokens crisis, and crisis means the Bank hasn’t been doing its job.
So, given that there was no emergency and thus no cause to transmit some “shock and awe” message to consumers, businesses and financial markets, the long-expected further increase in Bank rates of a quarter of a percentage point to 4.5 per cent was carefully pitched.
Had the Bank paused its policy of gradually taking its preferred “baby steps” to restrain inflation and return the policy rate to normal, it would have signalled either some lack of resolve or else some panicky response to an unforeseen danger to economic activity or financial stability.
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