BOE Expected to Hold Interest Rates Amid Rising Inflation

The Bank of England is expected to keep interest rates unchanged despite rising inflation in the UK. The central bank's Monetary Policy Committee will meet on Thursday, and economists predict that a majority of members will vote to maintain the main rate at 3.75% for the sixth consecutive meeting.

Official figures show that consumer prices rose to 3.1% in August from 2.9% in July, exceeding the Bank of England's 2% target. The increase is largely due to rising fuel and airfare prices, which are partly a result of the Iran war.

David Rees, head of global economics at Schroders, believes that interest rates will be held because the economic backdrop remains relatively soft, with wages and the labor market not showing significant growth. This should limit the impact of imported price pressures on domestic wages and prices.