Bank of England holds interest rates at 3.75% but says inflation still to rise

Maike Currie, vice president of personal finance at PensionBee, said: “Today’s decision was never really about what the Bank of England did, but what it said next.

“The 7–2 split also tells an important story.

“While the majority believe a cooling labour market and sluggish economy should gradually bring inflation back under control, two policymakers, Megan Greene and Huw Pill, voted for a rate rise because they fear higher energy costs could become embedded in the economy.

“If businesses pass those costs on to consumers and workers push for higher pay to offset rising household bills, inflation could prove much harder to bring back to target.”