Bank of England holds interest rate at 3.75%

The Bank of England announced it had held its interest rate steady at 3.75% for the fifth consecutive time, warning that rising energy prices due to the war in the Middle East continue to directly affect inflation and interest rates.

The Bank’s Monetary Policy Committee stated in its regular report that the decision to keep the rate unchanged was supported by six of its nine members, while three members voted to raise the rate by a quarter of a percentage point to 4%.

It noted that the prolonged conflict in the Middle East has contributed to a further increase in crude and refined energy prices since its last meeting in June, with prices remaining at higher levels and exhibiting greater volatility compared to pre-conflict levels.

In this regard, the Committee pointed out that “inflation in the United Kingdom, as measured by the Consumer Price Index, rose to 3.1% in August last month, and it is expected to continue rising in the coming months as the Bank seeks to implement monetary measures to keep it close to the 2% target.”

It is worth noting that the inflation rate jumped to 3.1% last month, driven by rising energy and fuel prices.