UK Bank Rate, as set by the Monetary Policy Committee (MPC) of the Bank of England, has declined from a peak of 5.25% in 2023/24 to 3.75% at the time of writing. With the majority of the downward movement assumed to be behind us, we have entered a phase of monetary policy setting where decisions are more finely balanced, to borrow central banker phrasing. This is reflected in the past two votes, which have been split 5–4 across the Committee’s nine members, with Governor Andrew Bailey moving from the ‘no-change’ to ‘cut’ camp in December 2025 and swinging the vote.
This division highlights that the MPC is split over the future path of Bank Rate, but the headline vote count itself doesn’t tell us anything about the depth of disagreement. The MPC meeting minutes have always been key to interpreting this detail but until recently, insight into individual committee member thinking tended to come only through occasional speeches or media appearances. An interesting recent development has been the introduction of attributed paragraphs in the MPC minutes, setting out each member’s reasoning in their own name. This now provides a far clearer view into individual reasoning and allows easier assessment of who sits at the dovish and hawkish ends of the spectrum.
The current distance between the extremes is meaningful. Rather than pulling apart all nine statements from December here, a look at the opposite ends of the MPC spectrum helps illustrate the debate currently guiding interest rate decisions.
At the dovish end of the Committee, Swati Dhingra stands out (with Alan Taylor not far behind). Dhingra’s position suggested support for ongoing cuts and reflects a conviction that the disinflation process is well on-track. She characterises the outlook as one of persistent demand weakness, a labour market that is loosening more quickly than expected, and a growing worry about maintaining Bank Rate too high for too long. Inflation, in her view, is being contained not just by easing price pressures but by continuing weakness in household spending. She is explicit in her opposition to a “drawn-out normalisation” of policy, with a focus on avoiding overtightening, even if that means moving towards neutral more quickly than others would prefer.
At the opposite end of the spectrum sits Huw Pill. He remains the clearest advocate for maintaining policy restriction and places greater weight on the risk of inflation stabilising above target than on the risk of an undershoot driven by weak demand. His assessment is based on concerns about structural changes in price and wage-setting behaviour and in evidence that disinflation in expectations may be stalling. He highlights forward-looking measures of wages and prices, describing a “shallow saucer-shaped profile” that suggests momentum towards target may be fading. While acknowledging soft activity data, he is less persuaded that these will translate into a downturn.
Other members sit somewhere between these positions, with some in each camp closer to the fence with emphasis on caution and data dependence. As the policy rate moves closer to neutral (the level of which is an ongoing debate), these marginal positions are likely to matter more than the headline split, particularly if incoming data continue to soften but wage and inflation expectations prove slower to adjust.
Projections for Bank Rate are similarly split across economists, markets and other forecasters (including Arlingclose). While further policy easing is generally expected, views on the timing and extent are now more dispersed, from only one more 0.25% rate cut later in 2026 through to a full 1% decrease in more rapid fashion. If you’d like to discuss Arlingclose’s macroeconomic and interest rate forecasting services, please contact us on info@arlingclose.com.
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