Pound Holds Near Two-Month Low as BoE Keeps Rates Steady

The British pound held steady near its two-month low after the Bank of England's (BoE) decision to keep interest rates at 3.75% in a closely contested 6-3 vote.

In prepared remarks, Governor Andrew Bailey warned that inflationary pressures could intensify due to the conflict in the Middle East and potentially lead to higher rates if prolonged volatility continues.

The BoE also reduced its stock of UK government bond purchases to zero through a multi-year program, with an average annual pace of £46 billion by 2034, slower than expected by markets.