BoE MPC Vote Hike

What is BoE MPC Vote Hike?

The BoE MPC Vote Hike is the number of votes to raise Bank Rate at a Monetary Policy Committee meeting. Bank Rate is the UK central bank policy rate, and the Committee is the UK rate setting body with 9 voting members. It covers the UK with 1 shared rate and 9 named seats, so it is a headcount, not a survey or forecast. A non-zero hike count can sit inside a hold, a decision to keep Bank Rate unchanged, so the vote is dissent inside a decision.

When is it released and what happens each release?

The Committee meets 8 times a year, about every 6 weeks. Each decision is published at 12 noon London time on the day after the meeting ends, with the Summary and minutes. Minutes show the full vote split with names and reasoning, and 4 of 8 releases add the Monetary Policy Report. Each vote is final with no revisions, alongside a voting history file, while transcripts follow with an 8 year lag.

What moves BoE MPC Vote Hike?

Votes to hike gain support when wage growth picks up, jobs tighten, inflation risks run above the 2% inflation goal, or expectations need anchoring.

• Governor: chairs the vote and holds 1 vote, plus a casting vote to break ties.
• Deputy Governors: 3 votes across Monetary Policy, Financial Stability, and Markets and Banking roles.
• Chief Economist: 1 vote on the Committee.
• External members: 4 votes from members appointed by the Chancellor to add outside thinking.
• Treasury representative: 0 votes, attends to discuss policy and brief on fiscal policy.

The August 7, 2014 release teaches the core lesson with Bank Rate maintained at 0.5% on a 7-2 vote. In that release, 2 members voted against holding and preferred a 25 basis point rise as jobs tightened. The majority saw weak wage growth and low inflation pressure and feared harm from tightening too soon near the effective lower bound. The lesson is that a 7-2 hold with 2 hike votes can signal a live tightening debate inside unchanged policy.

How is BoE MPC Vote Hike calculated?

1. Proposition: The Governor puts a rate proposal, for example that Bank Rate should stay at a stated level.
2. Vote: Each of the 9 members present votes for or against, and those wanting a higher rate vote against and name their choice.
3. Count: V_hike equals the number of increase votes, from 0 to 9, with no weights or adjustments.
4. Majority: The proposal passes with 5 of 9 votes at full attendance, and a tie is broken by the Governor casting vote.
5. Example: With 9 votes on holding at 0.5%, 7 back holding and 2 back a 25 basis point rise, so V_hike is 2. Holding passes 7-2.

Key point: 2 hike votes do not mean rates rose, and the 0 to 9 count has no 50 line, unlike PMI, a survey gauge.