Bank of England Holds Rate at 3.75% for Second Straight Meeting, Warns of Upside Inflation Risk

The Bank of England's Monetary Policy Committee voted 6 to 3 to hold Bank Rate at 3.75 percent at its meeting ending on 16 September 2026 (26 Shahrivar 1405); three members had favored raising it by 0.25 percentage points to 4 percent. The committee said protracted conflict in West Asia has driven crude and refined energy prices further above pre-conflict levels since the July meeting, and UK consumer price inflation rose to 3.1 percent in August. The statement said Ofgem's household energy price cap for October to December will rise to 1,723 pounds, with a further increase expected in the first quarter of 2027.

According to figures cited in the statement, Brent crude had reached 106 dollars a barrel and UK wholesale gas 207 pence a therm by the close of business on 14 September 2026 (23 Shahrivar), up 36 percent and 78 percent respectively from levels before the July report. The committee also voted unanimously to reduce its stock of UK government bond holdings to zero through a multi-year plan, selling an average of 46 billion pounds a year through 2034.