By bizn_fun 
Bank of England policymakers have left interest rates on hold at 4% amid concerns about persistent above-target inflation.
The central bank’s nine-member monetary policy committee (MPC) voted 7-2 to leave borrowing costs unchanged, after five cuts since summer 2024, including a reduction last month.
The governor, Andrew Bailey, said: “We held interest rates at 4% today. Although we expect inflation to return to our 2% target, we’re not out of the woods yet so any future cuts will need to be made gradually and carefully.”
The MPC had been widely expected to pause rate cuts this month, with annual inflation running well above the Bank’s 2% target, at 3.8% in August.
Policymakers have been balancing the risks of rising inflation – caused in part by a jump in food prices – against a continuing slowdown in the jobs market, with unemployment at a four-year high.
In the minutes of Thursday’s meeting, the MPC said its own estimates showed employment growth at zero, which it said was “partly attributable to the impact of increases in employers’ national insurance contributions (NICs)”. Reeves’s £25bn NICs increase at last year’s budget sparked a furious backlash from business groups.
Two members of the committee, Swati Dhingra and Prof Alan Taylor, voted for another quarter point rate cut this month. The MPC’s decision to hold rates widens the gulf between its stance and the US Federal Reserve, which reduced interest rates by a quarter of a percentage point on Wednesday, its first rate cut since December.
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