Bank of England Keeps Rates Unchanged Amid Rising Inflation

The Bank of England kept its main interest rate unchanged at 3.75% despite higher inflation, which has risen to a five-month high due to the fallout from the Iran war.

According to the Bank's Governor Andrew Bailey, the current volatility in global energy costs will have a bigger impact on inflation if it persists, making it more likely for the bank to raise interest rates in the future.

The decision was widely anticipated, with six members of the Monetary Policy Committee voting to keep rates unchanged and three backing a quarter-point increase to 4%.

While borrowing rates were kept on hold, financial markets believe that the Bank will back an increase at one of its next two policy meetings in November or December.