The rate-setting Monetary Policy Committee voted in a 7 to 2 split in favour of holding the rate, which affects a wide range of consumer loan agreements from credit card to mortgage payments.

Two members voted to reduce bank rate by 0.25% to 3.75%.

The bank rate was cut from 4.25% to 4% in August in a 5 to 4 split.

In the MPC’s summary today, it states: “A gradual and careful approach to the further withdrawal of monetary policy restraint remains appropriate.”

“The restrictiveness of monetary policy has fallen as Bank Rate has been reduced. The timing and pace of future reductions in the restrictiveness of policy will depend on the extent to which underlying disinflationary pressures continue to ease.”

Yesterday, the Office for National Statistics revealed inflation was 3.8% for the 12 months to August 2025, unchanged from July.

Economists predicted last week that the base would hold at 4% as fears mounted around inflation.

Bank of England governor Andrew Bailey warned last week that there is “considerably more doubt” about when the central bank will be able to cut interest rates again.

After the governor’s comments, markets ruled out further rate cuts for the rest of this year.

Today, the MPC says: “Twelve-month CPI inflation was 3.8% in August, and is expected to increase slightly in September, before falling towards the 2% target thereafter.”

“The Committee remains alert to the risk that this temporary increase in inflation could put additional upward pressure on the wage and price-setting process.”