Bank of England holds rates at 3.75% and warns inflation will stay elevated

The Bank of England held Bank Rate at 3.75% on Thursday and warned that inflation is likely to rise more than expected in the near term after energy prices were pushed higher by conflict in the Middle East.

The Monetary Policy Committee voted 8-1 to leave borrowing costs unchanged, according to the Bank's April 2026 Monetary Policy Summary and Minutes. One member voted for an increase.

The decision comes as policymakers weigh the risk that higher energy costs feed through into household bills and broader prices over the coming months. The Bank said the shock means inflation will be higher than expected for a period, even as it continues to monitor the wider economic impact.

The central bank also published its April 2026 Monetary Policy Report on Thursday, alongside the rate announcement.

The hold follows the Bank's March decision, when it also kept Bank Rate at 3.75%. At that time, the MPC warned that conflict in the Middle East could lift inflation in the near term.

The latest statement keeps attention on how quickly energy prices settle and whether the inflation bump proves temporary or more persistent. If the shock lasts, the Bank may face a harder trade-off between supporting growth and restraining prices at later meetings.