PwC UK comment on the September 2026 MPC meeting

Commenting on the Bank of England MPC meeting today and the vote to keep its policy rate at 3.75%, Jake Finney, Senior Economist at PwC, said:  

“By keeping rates on hold, the Bank of England has chosen patience over haste. While the external backdrop has worsened, with energy prices rising sharply, the Bank has opted to wait for clearer evidence that it has fed into broader inflationary pressures.

“With oil prices now above $100 a barrel, we are approaching the most adverse of the three scenarios the Bank outlined in July, which its models suggested could require up to four rate hikes. The key question now is persistence: a prolonged period of high energy prices would increase the risk of broader inflation pressures and strengthen the case for further rate rises. But with the jobs market still fragile, the committee will want to move cautiously.

“Now the Bank has made its decision, attention will turn to the Government. The fiscal rules leave limited room for a large stimulus package, but ministers may still look to ease some of the cost-of-living pressures. That challenge remains significant, with UK consumer prices now nearly a third (31%) higher than at the start of 2021, compared to 26% in the Eurozone.”