UK interest rate trends January 2015


  Steve Smith’s monthly look at data from the Bank of England.



The UK base rate remains at 0.5% per annum after a unanimous decision at the January MPC meeting. The rate has been held again in February following a fall in CPI to 0.55% per annum in December.

The MPC minutes for January suggest that CPI fall in December had not been expected a couple of months earlier and also indicate that CPI may fall to zero in February/March.

The first increase in base rate is now very unlikely to be before the second half of 2015. GBP LIBOR 6 and 12 month rates edged lower in January.

In the chart below shows the CPI trend on the right axis and GBP LIBOR on the left axis.

Graph Interest rates Jan 2015.docx

© Icknield 2015   Data sourced from the Bank of England database & ONS


In January 1 year and 6 month GBP LIBOR both fell by 0.01% per annum ending the month at 1.025% and 0.665% per annum respectively whilst 3 month GBP LIBOR held at 0.53% per annum.

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