Bank of England Keeps Interest Rates Unchanged Amid Divided Vote

The FTSE 100 index fell by 0.1% after the Bank of England's decision to keep interest rates unchanged, despite a divided vote among policymakers.

Three members of the Monetary Policy Committee voted for a 25 basis point increase in interest rates, which would have taken the rate to 4%, but were outvoted by six other members who preferred to leave rates at 3.75%.

Inflation has fallen faster than expected, according to Bank of England Governor Andrew Bailey, but he warned that rising energy prices linked to the conflict in the Middle East could push inflation higher again later this year.

The central bank said UK inflation has eased to 2.6%, and officials pointed to high mortgage costs, expensive borrowing, and a weaker labor market as factors slowing consumer spending.