Tuesday, 06 October 2026 Search Subscribe
The Bank of England building in the City of London
Ben Brooksbank, CC BY-SA 2.0, via Wikimedia Commons

Bank of England holds rates as inflation proves stubborn

The Monetary Policy Committee voted to keep Bank Rate on hold, judging that inflation remains too high to cut.

The Bank of England's Monetary Policy Committee has voted to hold Bank Rate, judging that inflation remains above target and that policy must stay restrictive for long enough to return it to 2 per cent.

The decision was widely expected by economists polled ahead of the announcement. Markets had priced in a hold after inflation data showed price pressures proving more persistent than hoped.

A historic Bank of England ten-pound note from 1926
Bank of England, public domain, via Wikimedia Commons
A 1926 Bank of England ten-pound note. Persistent inflation has kept the MPC cautious about cutting rates.

In its statement, the Committee said it would continue to monitor the evolution of inflation persistence and would not cut rates until it was confident that inflation was on a sustained path back to target.

Policy must stay restrictive for long enough to return inflation to 2 per cent.Bank of England

The hold keeps borrowing costs elevated for households and businesses. Mortgage holders on variable rates and those remortgaging will continue to face higher monthly payments than they were used to before rates began rising.

The City of London skyline at dusk
David Iliff, CC BY-SA 4.0, via Wikimedia Commons
The City of London. Markets had priced in a hold ahead of the decision.

Economists are divided on when the first cut might come. Some expect the Committee to move once there is clearer evidence that wage growth is cooling; others think rates could stay on hold well into next year.

The Bank's next decision will be accompanied by its Monetary Policy Report, with updated forecasts for growth, inflation and unemployment.

Filed under: Economy, Bank of England, Interest rates, Inflation, MPC

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Economics Editor