Under these assumptions, the Bank's inflation forecasts were downwardly revised a bit, with inflation now seen back to target at the end of two years and holding steady over the remainder of the forecast horizon.
Bank of England officials, including Governor Mark Carney, had appeared to endorse that expectation and their decision to not follow through has led to accusations they are becoming unpredictable. The MPC voted 7-2 to hold the rate steady, as predicted by all but three of 54 economists in a Bloomberg survey.
Looking ahead, the bank of England sees the rate hike path in line with the market forecast that sees the 86 percent probability of the Bank of England moving in November, down from 86 percent anticipated ahead of May Inflation Report.
He argued that the "underlying pace of growth remains more resilient than the headline data suggest", though the bank still had to revise down its forecast for this year's growth to 1.4 percent from 1.8 percent.
Sterling weakened after the Monetary Policy Committee surprised economists who were expecting a "hawkish hold" on policy, by cutting its forecasts for near-term growth in the United Kingdom economy and for inflation.
But it signalled hikes are still on the way with the economy set to bounce back from a weather-hit "soft patch".
And while Brexit-fuelled inflation has fallen sharper than expected in recent months, the Bank said rate hikes would still be needed over the next three years, with cost pressures building in the economy. But slowing consumer lending and a sluggish housing market created greater-than-usual uncertainty about consumer demand, the BoE said. The BoE thinks that unless interest rates rise, even modest economic growth of about 1.5 percent a year risks stoking excess inflation, due to Britain´s long-standing weak productivity growth and reduced immigration as a result of Brexit.
The MPC forecast GDP growth averaging 1.75 percent for each of the years up to 2020. Since he joined the BoE in 2013, Carney has signalled several times that the time was nearing for rates to rise from the historic low of 0.5 percent reached during the 2008-09 financial crisis, only for economic data to surprise him.
Overall, he said, the BoE was sticking to its message that rates would probably need to rise - for only the second time in over a decade - once that recovery was clear.
They said that no progress has been made in the economy, so no rate hikes this time.
However, JP Morgan economist Allan Monks said the BoE had sent a "muddled message" about its intentions.
"The only people who throw that term at me are in this room", Carney told the news conference.