Bank of England Holds Base Rate 8-1 as External Inflation Meets Domestic Strain

1 articles · Updated · Mortgage Soup · May 11

An 8-1 MPC vote kept the Bank Base Rate unchanged, with only Huw Pill backing a 0.25% increase despite renewed inflation pressure.
Energy-driven inflation and other external shocks were seen as poor targets for higher rates, while households and businesses already face tighter borrowing costs and weaker disposable income.
The minutes also pointed to a loosening labour market, easing wage growth and subdued activity, reinforcing the majority view that policy is already restrictive enough.
For mortgage borrowers, the hold offers a steadier backdrop after months of volatile pricing, though swap rates still drive fixed-rate deals and have caused frequent product repricing and withdrawals.
The next MPC decision on June 18 now becomes the key marker, with the hold viewed as a pause that preserves flexibility rather than a clear turning point.

Facing a stagflation dilemma, is the Bank's pause on rates a dangerous gamble that risks a much deeper recession later on?

As global conflicts fuel UK inflation, is the Bank of England losing its power to control prices with traditional monetary policy?

With mortgage rates climbing despite the Bank's hold, is the UK facing an affordability crisis that interest rates alone cannot fix?