Topic
bank of england
Business UK Interest Rates Expected to Hold at 3.75% as Bank of England Maintains Cautious Stance Amid Global Uncertainty
The Bank of England is widely expected to hold its benchmark interest rate at 3.75% for a fifth consecutive meeting, as uncertainty over global politics, the Middle East conflict, and inflation persists. The decision, due at 12:00 BST, will keep mortgage repayments stable for tracker borrowers but fixed-rate deals are rising, with the average two-year fixed rate at 5.62%.
Finance Bank of England Chief Economist Says Interest Rates May Need to Rise This Year
Bank of England chief economist Huw Pill indicated that interest rates may need to rise this year to control inflation, currently at 2.8% above the 2% target. Pill was among a minority of MPC members voting for a rate increase in June. He cited lower economic speed limits and productivity slowdowns, particularly in Wales, as reasons for potential tightening.
Trade Brexit cost 6% of UK economy, Bank of England company data suggests, study finds
A study using internal Bank of England data on thousands of British companies estimates Brexit has cost the UK economy 6% of GDP over a decade. Half the hit came from post-referendum uncertainty, the rest from rising trade barriers after leaving the customs union and single market in 2021. Bank Governor Andrew Bailey acknowledged the negative impact on growth and export markets.
Trade Brexit Cost UK Economy 6% According to Bank of England Company Data Study
Economists analyzing Bank of England's Decision Maker Panel data found Brexit cost the UK economy 6% of GDP over ten years. Half the impact came from post-referendum uncertainty, half from rising trade barriers after 2021. The study used company-level data alongside five other methods, with an average estimate of 8%.
Finance Bank of England Expected to Hold Interest Rates at 3.75% for Fourth Consecutive Meeting
The Bank of England is widely expected to hold its benchmark interest rate at 3.75% for a fourth consecutive meeting, according to analysts. The UK inflation rate remains above target but has not risen as high as many feared due to the US-Israel war with Iran. Oil prices have dropped after a peace deal, potentially easing energy price pressures, though domestic gas and electricity prices are expected to rise with the next Ofgem price cap in July.
Business UK Inflation Holds at 2.8% in May, Defying Expectations of Rise to 3%
UK inflation held at 2.8% in the year to May, unchanged from April and above the Bank of England's 2% target, surprising economists who had forecast a rise to 3%. A sharp fall in food inflation and the reduction in the government's energy price cap counteracted upward pressure from the Middle East conflict, while the recent peace agreement between the US and Iran has lowered oil prices, potentially keeping inflation below worst-case scenarios. Core inflation edged up to 2.6%, and analysts warn that the next energy price cap increase in July could push prices higher.
Business UK Inflation Holds at 2.8% in May, Beating Forecasts as Transport Costs Rise Fastest
UK inflation remained at 2.8% in the year to May 2026, matching the prior month and narrowly missing analyst expectations. The Office for National Statistics reported transport costs as the fastest-rising category, while food and non-alcoholic beverage prices fell slightly. Economists expect inflation to continue rising over the coming months due to the ongoing effects of the Iran war, with a projected peak between 3.5% and 4% in the second half of 2026.
Business UK Base Rate Held at 3.75% as War in Iran Upends Rate Cut Expectations
The Bank of England held interest rates at 3.75% for the third time, the lowest since February 2023, as the economic impact of the war in Iran upends expectations for further cuts. Sustained higher inflation could force up to six rate rises, potentially bringing the base rate to 5.5%, but weak jobs market and sluggish growth complicate the outlook.