BoE Keeps Rates at 3.75% Amid Energy Price Concerns
The Bank of England kept interest rates at 3.75% for the sixth consecutive meeting on Thursday, as widely expected.
A majority of 6-3 voted to maintain the status quo, with three dissenting members - Megan Greene, Catherine Mann, and Huw Pill - favoring a 25 basis points hike.
The six members who supported keeping rates unchanged were concerned about recent developments in energy prices and their potential impact on holding CPI inflation above target for longer than expected.
They cited 'domestic activity and tight financial conditions' as restraining inflationary pressures, but acknowledged the growing risk of second-round effects without a lasting resolution to the conflict.
The three hawks who voted in favor of a hike pointed out that the escalation and duration of the Middle East conflict continue to raise energy and food prices, with projected inflation peaking in early 2027.