Bank of England Holds Rate at 3.75% by 7-2 Vote as Inflation Peak Seen Near 3.25%
Updated
Updated · Mortgage Soup · Jun 23
Bank of England Holds Rate at 3.75% by 7-2 Vote as Inflation Peak Seen Near 3.25%
3 articles · Updated · Mortgage Soup · Jun 23
Summary
The MPC left the Bank Base Rate unchanged at 3.75%, with only Megan Greene and Huw Pill backing a quarter-point increase in a 7-2 vote.
May CPI held at 2.8%—below the Bank’s earlier expectations and down from 3.3% in March—prompting the BoE to trim its expected inflation peak to just above 3.25% from about 3.6%.
Weak demand, slowing wage growth, falling vacancies and a gradually loosening labour market reinforced the majority view that there is not yet enough evidence to tighten further.
Mortgage borrowers have already absorbed much of the recent shock, with higher swap rates and market repricing pushing up lending costs even though the base rate has stayed at 3.75% since December.
The decision signals the BoE sees policy as already restrictive and is prioritizing stability while watching whether higher energy costs from Middle East tensions feed into broader inflation later this year.