Meanwhile, the Bank has revised down its near-term inflation forecast. Price growth, as measured by the consumer prices index (CPI), stood at zero in June – and the Bank expects it to remain at around this level until September at least.
It attributed this to a number of factors, including falling commodity prices over the quarter, although policymakers do not expect the UK to slip back into deflation outright, like it did earlier this year.
It also noted that inflation would currently stand at 1.5% if falling energy, food and import prices were not factored into current calculations.
When inflation does return, it is expected to sharply rise to around 0.5% by the end of the year, and then 1% by February 2016.
In the long-term, the Bank believes inflation will reach Governor Mark Carney’s stated target of 2% in two years, before rising further to 2.1% a year later. The report estimates that interest rates will rise (to 0.75 per cent) in Q2 of 2016, before rising to 1% by the year’s end.