The Bank of England’s Monetary Policy Committee (MPC) raised Bank Rate by 25 basis points to 4% in November 2026, citing mounting inflationary pressures from higher energy prices and stronger-than-expected activity. The eight-to-one vote saw the dissenter favour a larger increase, following a 25-basis-point cut to 3.75% in December 2025 and subsequent holds through September 2026. Consumer price index (CPI) inflation rose to 3.5% in September and was projected to reach around 5% in 2027 Q2 before declining as energy-price effects fade and restrictive monetary policy restrains inflation. Evidence of knock-on effects on other prices and wages remained limited, but the MPC judged that risks of material second-round effects had increased, while many underlying inflation measures had stopped falling above target-consistent rates. Economic growth was expected to moderate over coming quarters despite recent resilience, while business lending growth remained strong. Further increases in global energy prices amid the prolonged Middle East conflict remained the main source of uncertainty for the inflation outlook. The MPC stressed that policy was not on a pre-set path and would monitor pay, pricing behaviour and economic slack, adjusting Bank Rate as necessary to return inflation to the 2% target sustainably in the medium term.
Bank of England raises Bank Rate by 25 basis points to 4%
The Bank of England’s Monetary Policy Committee raised Bank Rate by 25 basis points to 4% in November 2026 in an eight-to-one vote, citing higher energy prices and stronger-than-expected activity. Consumer price index inflation was projected to reach around 5% in the second quarter of 2027, with the committee warning of increased risks of second-round effects.