The BOE's Biggest Hawk Is Setting Off for One More Flight
(Bloomberg) -- The Bank of England’s biggest hawk is setting off for what could be his final flight.
BOE officials voted 7-2 to maintain interest rates at 0.5 percent this month, with Ian McCafferty and Michael Saunders calling for a 25-basis-point increase. McCafferty has now voted for a rate hike 16 times across his 61 meetings, with his only success thus far coming in November -- when the BOE raised borrowing costs for the first time in more than a decade.
With his term on the Monetary Policy Committee due to end in August, this could be the start of McCafferty’s final push for higher rates. The official accounts for almost half of the 34 votes for rate increases across all policy makers during his tenure, which started in September 2012.
While McCafferty has an about 6 percent success rate when voting for hikes, his single vote for a cut came as officials unanimously opted to reduce borrowing costs in August 2016. Still, investors are betting that he will enjoy one more success before retirement, with markets pricing in about a 90 percent chance of a hike in May.
Saunders, his fellow dissenter in today’s decision, cast his fifth vote for higher rates since he started in 2016.
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