At its 16 September 2026 meeting, the Bank of England’s Monetary Policy Committee (MPC) voted 6–3 to leave Bank Rate unchanged at 3.75%, in line with market expectations. Three members again favoured a 25-basis-point increase to 4%, as they had at the July meeting.
The MPC noted that the prolonged conflict in the Middle East has driven up crude oil and refined energy prices and increased market volatility. This has contributed to a rise in UK CPI inflation to 3.1% in August, with further increases expected over the coming quarters. The Committee emphasised that monetary policy must ensure inflation returns sustainably to the 2% target, while it assesses the scale and persistence of the energy shock.
To date, the MPC sees limited evidence of significant second-round effects on wages and prices, though it warned that these risks could grow if elevated energy costs persist. The Committee also voted unanimously to unwind its stock of government bond purchases to zero through a multi-year programme, planning to reduce holdings at an average annual pace of £46 billion through 2034.
