Overview
- Deputy governor Clare Lombardelli told MPs that early Bank analysis shows the Budget will lower headline inflation by 0.4–0.5 percentage points for a year from around the second quarter of 2026.
- The Chancellor’s plan to fund part of the renewables obligation from April shifts costs off household energy bills, with the Treasury saying typical bills could fall by about £150 a year.
- The Office for Budget Responsibility projects a 0.4 percentage point reduction in inflation next year, then a 0.1 point uplift in each of the following two years from the end of the fuel duty freeze and a new electric‑vehicle charge.
- Lombardelli said a slightly looser fiscal stance is likely to raise GDP in the short term, though the effect is expected to be small.
- Deputy governor Dave Ramsden, who backed a cut at the last meeting, said he is proceeding gradually as the MPC meets next week to decide whether to reduce the 4% policy rate.