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Bank of England to Hold Rates at 3.75 Percent

By Markets Desk · 2026-09-13 · 1 min read
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Illustration: Tradingbird

The Bank of England is projected to maintain its policy rate at 3.75 percent on Thursday. This marks the sixth consecutive month without a change in monetary policy.

The Bank of England is projected to maintain its policy rate at 3.75 percent on Thursday. This marks the sixth consecutive month without a change in monetary policy. The decision is widely anticipated by market participants. It reflects a cautious stance amid global economic uncertainties.

Three members of the Monetary Policy Committee previously voted for a rate increase. Huw Pill, Megan Greene, and Catherine Mann advocated for a hike to 4.0 percent. Their dissent indicates internal disagreement. The committee is expected to remain divided on the path forward.

Inflation data shows recent upward movement

Consumer prices in the UK rose to 2.9 percent in July. This is an increase from 2.6 percent in June. The figure represents the highest level since March. Services inflation declined from 3.6 percent to 3.4 percent. This suggests limited secondary effects on broader pricing.

Energy costs are set to rise in October. The new price cap will increase household bills by 4 percent. This adjustment is expected to push overall inflation higher. Analysts predict a peak near 4 percent by 2027.

Economic growth exceeds previous forecasts

The UK economy expanded by 0.4 percent in July. This growth outperformed initial estimates. The services sector drove much of this increase. Stronger economic activity complicates the monetary policy outlook. It increases the risk of persistent inflation.

The European Central Bank raised rates earlier this month. It cited ongoing inflationary pressures from the Iran conflict. The Bank of England must consider these external factors. Policymakers are preparing to respond to changing conditions.

Policymakers prepare for potential rate hikes

Experts advise the committee to remain ready for action. Energy price surges could necessitate a future increase. A November hike is now considered a possibility. The committee's communication will signal its flexibility. GN markets/policy notes the heightened uncertainty. The focus shifts to the language used in the statement.

Based on reporting by London Evening Standard, compiled by the Tradingbird desk.

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