BOE Holds Rates at 3.75% as UK Inflation Threat Lingers After U.S.-Iran Deal
Updated
Updated · The New York Times · Jun 18
BOE Holds Rates at 3.75% as UK Inflation Threat Lingers After U.S.-Iran Deal
3 articles · Updated · The New York Times · Jun 18
Summary
Bank of England officials said inflationary pressure will persist through 2026 even after the U.S.-Iran ceasefire and Strait of Hormuz reopening eased immediate market fears.
Energy costs remain above prewar levels despite recent declines, and policymakers warned logistical snags and lingering instability could slow the recovery of Persian Gulf production and exports.
At 3.75%, the BOE kept interest rates unchanged on Thursday, saying four months of elevated energy prices have already fed inflation pressure into Britain’s import-dependent economy.
The U.S.-Iran agreement targets a final deal within 60 days, but the BOE’s stance underscores how the war’s price shock is still shaping global central-bank decisions, including at the Federal Reserve.