Policymakers expect UK GDP growth to accelerate in early 2020 supported by a pickup in global activity, a further decline in Brexit uncertainties and government’s announced spending measures, and inflation is seen remaining below the 2% target until at least 2021. Still, officials revised down GDP forecasts for 2020 full year to 0.8% (vs 1.2% previously estimated), before accelerating to 1.4% in 2021 (vs 1.8%) and 1.7% in 2022 (vs 2.0%).
The central bank also said that interest rates may need to be cut if growth does not improve, or they could be raised "modestly" in future if the economy recovers in line with latest projections and inflation picks up. It was the last meeting chaired by Governor Carney before Andrew Bailey takes over in March.