GBP Plummets as BoE Holds Rates Amid Hawkish Vote

The British Pound to Euro exchange rate weakened on Thursday after the Bank of England left interest rates unchanged. The GBP/EUR rate fell to around €1.1655, its lowest level in four weeks.

Despite a more hawkish-than-expected Bank of England decision, the Pound struggled to attract support. The Bank of England's Monetary Policy Committee voted 6-3 in favour of holding rates at 3.75%, with three policymakers preferring an immediate 25-basis-point increase.

The Bank warned that volatile energy prices and tensions in the Middle East could push inflation higher over the coming months. Its central forecast showed inflation rising to 3.2% later this year, although policymakers stressed that there remained substantial uncertainty surrounding the energy outlook.