The MPC voted 7-2 to keep rates steady, citing falling energy prices and easing inflation risks despite persistent economic uncertainty.
The Bank of England’s Monetary Policy Committee maintained its benchmark rate at 3.75% in a 7-2 vote, resisting calls for a 0.25 percentage point hike. Two dissenting members favored tightening to 4% amid lingering inflation concerns.
Consumer price inflation dropped to 2.8% from the previous meeting, though officials warned of a potential rebound later this year as energy price effects filter through. The labor market has loosened, and economic weakness may help contain wage-driven inflation pressures.
Global energy prices have declined but remain volatile and above pre-conflict levels. The MPC emphasized its focus on ensuring inflation sustainably returns to the 2% target, contingent on the shock’s duration and economic transmission.