A quarter-point cut is a mature decision by the Bank, incentivizing growth whilst maintaining a steady approach amidst global uncertainty. Deflation has seen good progress since the height of the cost of living crisis, but with volatility expected and a new trade reality to contend with, cautious progress remains the best option for a recovering but vulnerable economy.
The Bank has failed to deliver the bold steps necessary for monetary dynamism, opting for a lower than expected rate cut. The split decision shows a lack of clear direction or certainty in the bank's direction. A much more aggressive rate cut was in order to counter low growth and high inflation projections following Trump's aggressive global tariff regime.