Bank of England Confounds Markets, Keeps Rates On Hold

• The Bank of England kept interest rates on hold on Thursday, wrong-footing investors who had been convinced that it would be the first of the world's big central banks to raise borrowing costs after the COVID-19 pandemic. 
• The BoE kept alive the prospect of a move soon, saying it would probably have to raise bank rate from its all-time low of 0.1% "over coming months" if the economy performed as expected. 
• But seven of its nine policymakers voted to leave rates unchanged for now - even as they forecast inflation would reach almost 5% in April - so they can see how many people lose their jobs after the recent end of the government's furlough scheme. 
• The announcement sent shockwaves through markets, sending sterling towards its biggest fall since the early days of the COVID-19 pandemic in March 2020.

(Source: Reuters)