Bank of England Weighs Interest Rate Decision Amid Ongoing Energy Crisis

The Bank of England's Monetary Policy Committee is set to announce its benchmark interest rate decision on Thursday, with analysts expecting a hold at 3.75% despite accelerating inflation driven by Middle East conflict-induced energy shocks.

Official economic data released on Wednesday showed the Consumer Prices Index measure of inflation surged to 3.1% in August from 2.9% in July, marking its highest rate in six months due to rising fuel costs and airfares.

Global debt markets experienced heavy sell-offs, pushing Britain's 30-year gilt yields toward 6%, while two-year gilt yields suggest investors are pricing in as many as four interest rate hikes over the next 12 months.