Interest rates held at 5%

20 Sep 2024

The Bank of England's Monetary Policy Committee (MPC) voted to hold interest rates at 5%.

The MPC voted eight to one in favour of no change, with the Bank of England's Governor, Andrew Bailey, stating that rates should come down in coming months if inflation stays low.

Inflation held steady at 2.2% in the year to August according to official data from the Office for National Statistics (ONS).

Alpesh Paleja, Interim Deputy Chief Economist at the Confederation of British Industry (CBI), commented: 'The MPC was widely expected to hold fire this month, after the first rate cut in four years in August. There remain very varied views among the MPC around the degree of inflation persistence, and over what horizon this will dissipate.

'Monetary policy will be walking a fine line for a little while yet: between balancing upside risks to inflation, but not being too tight, so as to choke off activity. Developments in fiscal policy in October's Budget will also be a key consideration for growth prospects.'