BOE to Hold Interest Rates Amid Middle East Uncertainty

The Bank of England is expected to maintain its interest rates at 3.75% next week, despite fresh uncertainty in the Middle East. Economists predict a majority of the bank's rate-setting committee will vote to keep the current rate, with some predicting a seven-to-two vote.

The decision comes as inflation has eased back to a 15-month low of 2.6%, according to the Office for National Statistics. However, economists warn that this could be short-lived, with inflation expected to rise again later this year due to higher energy costs.

Thomas Pugh, chief economist at RSM UK, believes oil prices will have a significant impact on interest rates in the next year. If prices remain above $100 per barrel over the summer, he predicts a September rate hike and another in the winter.