The Monetary Policy Committee (MPC) meets eight times a year to set the base rate, and each time it works through a shared set of evidence. Understanding what it looks at explains why a decision sometimes surprises people who were watching only the headline inflation figure.

The target it has been set

The MPC's task is to keep inflation, measured by the Consumer Prices Index (CPI), close to the target set for it by HM Treasury. That target is fixed by government, so the MPC's own choice is only about the base rate: raise it, hold it, or cut it, in pursuit of that goal. A rate decision is read against that target.

The evidence behind each vote

Inflation on its own is a backward-looking number, so the Committee also works through a wider set of readings before it votes.

• Inflation and where it is heading
• The labour market, including wage growth and how much slack there is in employment, since pay pressure feeds into future prices.
• Output and demand across the economy, which shows whether growth is adding to inflationary pressure or easing it.
• Inflation expectations among households and businesses, because what people expect prices to do affects the wages and prices they set.
• External pressures such as energy costs and the exchange rate, which move UK prices without any domestic decision behind them.

Where the Committee disagrees

The nine members do not always read this evidence the same way, and the vote is published split when that happens. Some members weight the risk of inflation staying high more heavily; others weight the risk of raising rates too far and slowing the economy more than needed. Both readings are working from the same data, so neither is simply right or wrong at the time of the vote.

The base rate's history, with each decision date, is on the rate reference page. The rate that came out of the most recent meeting, and the date of the next one, is on the current rate and decision date page. Anyone starting from the basics of what the base rate actually is can begin with what the base rate is and who sets it.