Bank of England Expected to Hold Rates at 3.75% Amid Middle East Tensions
Economists expect a 7-2 vote to keep the base rate at 3.75% as oil prices rise and inflation risks return.
- The Monetary Policy Committee meets on Thursday, July 30, where the Bank of England is widely expected to maintain the base interest rate at 3.75% despite rising geopolitical uncertainty.
- UK inflation eased to 2.6% in June, offering relief before renewed instability in the Middle East complicated the economic outlook, the Office for National Statistics reported.
- Oil prices surged above 100 dollars per barrel, while experts at Oxford Economics and Nomura predict a seven-to-two vote to hold rates despite modest GDP growth of 0.1% in May.
- Governor Andrew Bailey is expected to address how renewed hostilities influence inflation, which the Bank projects will rise to 3.25% later this year, moving further from the 2% target.
- Thomas Pugh, chief economist at RSM, noted that oil prices will "largely" steer rates; sustained high prices could force a September hike, though economists suggest cuts might follow in 2027 if conditions ease.
25 Articles
25 Articles
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Bank of England expected to hold interest rates steady
The Bank of England (BoE) looks set to keep interest rates unchanged at 3.75 per cent on Thursday, despite a recent spike in oil prices above $100 a barrel which may test whether it can avoid raising borrowing costs in response to the US-Iran conflict. So far, British inflation has come in below the BoE’s […]
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