It keeps the central bank’s key rate at a 16-year high of 5.25%, where it has been held since August 2023.
The Bank of England on Thursday opted to keep interest rates steady at its June meeting, confirming market expectations even after U.K. inflation hit its 2% target.
It keeps the central bank’s key rate at a 16-year high of 5.25%, where it has been held since August 2023.
Seven members of the Monetary Policy Committee voted to hold, while two favored to cut by 25 basis points, the same as during the central bank’s May meeting.
In a statement, the MPC noted inflation had reached the central bank’s target and said indicators of „short-term inflation expectations“ and wage growth had eased.
It was „very difficult to gauge the evolution of labour market activity“ because of uncertainty around estimates from the Office for National Statistics, the MPC added.
In a repeat of previous messaging that some analysts had thought it may drop, it again said monetary policy needs to „remain restrictive for sufficiently long to return inflation to the 2% target sustainably.“
Inflation data on Wednesday showed headline price rises cooled to 2% in May, meeting the central bank’s target ahead of the U.S. and the euro zone, despite the U.K. suffering a sharper spike inflation over the last two years.
