BoE: Patience for now, but risks skewed towards tightening

Research evidence excerpt

BoE: Patience for now, but risks skewed towards tightening

J P M O R G A N Europe Economic Research

18 June 2026

BoE: Patience for now, but risks

skewed towards tightening

• BoE on hold in a tighter 7-2 vote, but taking comfort from recent downside Economic and Policy Research

inflation surprises and lower energy prices Allan Monks

• MPC is indicating little urgency for a near-term hike, but retains a (44-20)allan.j.monks@jpmorgan.com7134-8309

tightening bias... J.P. Morgan Securities plc

• ...with an inclination to act only after risks of second-round effects become

clearer

• We push back our call for a hike from July to November

The BoE held rates today, with Greene joining Pill in dissenting hawkishly for a

25bp hike. Aside from that additional dissent, the overall message from the

statement and individual members’ paragraphs was that further evidence of

disinflation has bought more time for the committee to wait and assess the risk of

second-round effects and inflation persistence.

The statement struck a balanced tone. It noted a still material risk of second-round

effects due to inflation that is still expected to rise later this year, but this was

counter-balanced by the characterisation of a loosening labour market and signs of

a weakening economy. Given that GDP has actually been exceeding BoE

expectations alongside lower-than-expected unemployment, we think the MPC

will have to adjust its tone here if timely surveys of activity and confidence now

begin to pick up owing to recent geopolitical developments.

The statement maintained the same tightening bias as before, noting that the MPC

“stands ready to act as necessary”. But its neutral and balanced description of the

recent data suggest no urgency to hike in the near term. It also highlighted the