• The Bank of England kept its key interest rate unchanged at 4%, matching market expectations as policymakers navigate persistent inflation and slowing growth
• The decision was narrowly split (5–4), with four committee members voting for a 25 bps rate cut — Governor Andrew Bailey’s casting vote tipped the balance toward holding rates steady.
• UK inflation remains high at 3.8%, above the BoE’s 2% target, though officials stated it has likely peaked, with signs of continued disinflation.
• Wage growth and employment data suggest a softening labor market, strengthening expectations for rate cuts in the coming months.
• Analysts note that the decision may disappoint Chancellor Rachel Reeves, who is preparing a budget with new tax hikes later this month — hoping for lower borrowing costs to support growth.

What’s Next?:
The BoE’s cautious stance shows how central banks are balancing fragile growth with stubborn inflation. With the UK economy showing cracks, I expect the first rate cut to come early next year — potentially aligning with fiscal easing to cushion the slowdown.