Bank of England Holds Interest Rate at 3.75%, Sees Continued Hawkish Rhetoric

The Bank of England (BoE) has kept its interest rate at 3.75% with a 6-3 split, signaling slightly more hawkish rhetoric but continued comfort with existing tightening conditions.

TD Securities strategists note that the July Monetary Policy Report shows a more benign inflation and growth outlook, yet risks remain skewed to the upside.

Despite this, TD Securities still expects Bank Rate to remain on hold through September and an easing cycle starting in H1 2027.

The Committee shifted slightly toward the hawks, but the dominant message remained that existing financial tightening provides sufficient restraint for now while the MPC waits for clearer evidence on inflation persistence.