Your client is interested in having a good sense of the central bank policies and likely implications on interest rates and exchange rate movements during the next few months for the United Kingdom. You have been assigned a country and have to make a report that deals with the general question of monetary policy and likely interest rate and exchange rate developments.

The report should cover the following points (for the U.K.): 1. Central bank structure and policy instrument(s). 2. Historical record of evolution of key variables, like inflation, exchange rate, and interest rates, including inferences about central bank stance and credibility. 3. Future outlook on monetary policy, including likely effects of such policy on key economic variables (exchange rate, inflation, economic growth). Make sure to state clearly the underlying rationale for the expected monetary development as well as the underlying forces of its expected effects.