The Bank of England (BoE) will delay September’s Monetary Policy Committee (MPC) meeting following Queen Elizabeth II’s death.
The monarch passed away on Thursday, 8th September, and her death caused shockwaves around the nation and the globe. The Queen died aged 96, just over a year after her husband, the late Prince Philip, passed away. An announcement was made by Buckingham Palace on Thursday morning expressing concern for the Queen’s health. She passed away later that day with some of her immediate family by her side.
The announcement of her death meant that businesses, organizations, and associations had to make quick decisions about whether to close and cancel events as a mark of respect. Several events were canceled over the weekend, including various sporting events and gatherings like the annual TUC event. The BoE has decided to delay its MPC meeting due to the period of national mourning, which will last until 19th September, the day of the Queen’s funeral.
Interest rate increase expected
This month’s MPC meeting was due to take place this Thursday, and a base rate increase of 0.5% was widely expected. This comes as the BoE continues to tackle soaring inflation and would mark the second consecutive 0.5% rate hike. However, out of respect for the late monarch, the central bank said that it would now hold the decision-making meeting a week later than initially scheduled.
In an official statement, the central bank said: “In light of the period of national mourning now being observed in the United Kingdom, the September 2022 meeting of the monetary policy committee has been postponed for a period of one week. The committee’s decision will be announced at 12 noon on 22 September.”
Dates for MPC meetings are set at least one year in advance, and it is very rare for this sort of decision to be made. While the MPC has added extra meetings at times such as the global financial crisis, delaying a meeting is an extremely rare move. This reflects the magnitude of the passing of Queen Elizabeth II.
The day after the Queen’s passing, National Mourning guidance was published. The guidelines state that while some businesses might want to close or postpone events as a mark of respect, particularly on the day of the funeral, there is no obligation to do so. The BoE was not pressured to delay the September meeting but has decided to do so as the nation continues to mourn the death of the Queen.
It was noted that the decision to delay the meeting means that the central bank will have more time to look at its options around responding to inflation following the announcement of plans from the new Prime Minister, Liz Truss, to freeze household energy costs for two years from October.