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Bank of England to keep rates unchanged at 3.75% amid oil price surge
The Bank of England is expected to leave its base interest rate at 3.75% at the Monetary Policy Committee meeting on 30 July, despite oil prices spiking above $100 a barrel following the escalation of the U.S.–Iran conflict. British consumer‑price inflation fell to 2.6% in June, a 15‑month low, but remains above the 2% target that the Bank seeks.
Economists are split on the outlook. Futures markets price in a roughly two‑in‑three chance of a 0.25‑percentage‑point rate hike in September and some pricing of a further increase by winter, while others see the rate staying steady for the rest of the year. New Prime Minister Andy Burnham has pledged to focus on lowering the cost of living, but a second oil‑price shock could raise inflation expectations, warned BoE chief economist Huw Pill. Governor Andrew Bailey is expected to address the impact of the oil market volatility at the decision.
The decision comes as the UK’s inflation trajectory diverges from that of the United States and the euro area, where higher rates are being considered. Market participants note that the lag in domestic energy price transmission has kept UK inflation lower than in those regions.
Entities
Andrew Bailey · Andy Burnham · Bank of England · European Central Bank · Huw Pill · Michele Bullock · Reserve Bank of Australia · U.S.–Iran conflict
Claims
What the coverage asserts, and how many sources carry each claim.
- [● 13 SOURCES] The Bank of England is expected to keep its base interest rate at 3.75%. www.bdaily.co.uk · nation.cymru · www.independent.co.uk · mix929.com · jack1065.com · +7 more
- [● 13 SOURCES] Governor Andrew Bailey is expected to address oil‑price impacts during the rate decision meeting. mix929.com · jack1065.com · paratic.com · fr.businessam.be · wxerfm.com · +7 more
- [● 13 SOURCES] Oil prices rose above $100 per barrel due to the U.S.–Iran conflict. mix929.com · jack1065.com · paratic.com · fr.businessam.be · wxerfm.com · +7 more
- [● 13 SOURCES] UK consumer price inflation fell to 2.6% in June, a 15‑month low. mix929.com · jack1065.com · paratic.com · fr.businessam.be · wxerfm.com · +7 more
- [● 13 SOURCES] Prime Minister Andy Burnham has pledged to focus on lowering the cost of living. mix929.com · jack1065.com · paratic.com · fr.businessam.be · wxerfm.com · +7 more
- [● 13 SOURCES] BoE chief economist Huw Pill warned that a second oil‑price shock could raise inflation expectations. mix929.com · jack1065.com · paratic.com · fr.businessam.be · wxerfm.com · +7 more
- [● 13 SOURCES] Futures markets price in about a two‑in‑three chance of a 0.25‑percentage‑point BoE rate hike in September. mix929.com · jack1065.com · paratic.com · fr.businessam.be · wxerfm.com · +7 more