Bank of England holds rates as energy shock eases, but inflation risk keeps cuts distant
The Bank of England held interest rates at 3.75%, choosing not to follow the European Central Bank and Bank of Japan into fresh tightening as policymakers judged that Britain’s latest energy-driven inflation shock may fade, but not quickly enough to relax policy. The 7-2 vote keeps borrowing costs unchanged for now. It also leaves households, mortgage borrowers and businesses in the same uneasy place: rates are already restrictive, inflation is above target, and the next move is still not safe to call. Bank Rate is the BoE’s core policy rate, which affects what banks charge on loans and pay on savings.