Bank of England Hints at Rate Hike as Inflation Fears Grow
The Bank of England kept interest rates unchanged at its latest meeting, but hinted that it may raise them soon to combat inflation caused by the Iran war.
While six members of the Monetary Policy Committee voted to hold rates steady, three others backed a quarter-point increase to 4%.
Bank Governor Andrew Bailey noted that higher global energy costs have had a limited effect on prices and wages in the UK so far, but warned that this could change if volatility persists.
Inflation is expected to rise to around 4% in the first quarter of next year from the current 3.1%, driven by increasing domestic energy bills.
The Bank's rate-setters meet again on November 5, which some economists believe may be a natural moment for a change in policy as they will have the latest economic forecasts and Bailey will hold a press briefing.