STORY
The Bank of England has held interest rates at 3.75 per cent after its Monetary Policy Committee voted by seven to two to keep Bank Rate unchanged. Two members voted to increase rates by 0.25 percentage points to 4 per cent.
The Bank said the decision reflected uncertainty over inflationary pressures, including the impact of international energy prices. Governor Andrew Bailey said developments around the US-Iran agreement were encouraging, but the Bank continued to expect inflation to rise further before easing.
The decision leaves ministers facing continued pressure from borrowing costs, mortgage rates and household budgets. The Government has said its economic policy is focused on growth and stability, while opposition parties have continued to criticise Labour’s handling of the economy.