The Bank of England has voted to leave UK interest rates on hold, maintaining the Bank rate at 3.75% in a decision widely anticipated by economists.
The decision was not unanimous, however, as two policymakers advocated for an increase to 4%, but were outvoted by the remaining seven members who opted to hold rates steady.
In announcing its decision, the Bank stated: "Global energy prices have fallen since the previous meeting in response to events in the Middle East. But they remain higher than pre-conflict and have continued to be volatile. The impact of the energy shock on the UK economy remains uncertain. Monetary policy cannot influence energy prices but is being set to ensure that the economic adjustment to them occurs in a way that achieves the 2% inflation target sustainably. The policy stance required to achieve this will depend on the scale and duration of the shock, and how it propagates through the economy."
The Bank of England had previously cut rates six times since mid-2024 and was expected to continue doing so, before geopolitical tensions, including Trump's Operation Epic Fury, led to Iran choking off oil supplies from the Gulf.
