Bank of England raises Bank Rate to 4% on an 8–1 vote

The Monetary Policy Committee voted 8–1 to raise Bank Rate by 0.25 percentage points, with Mann preferring a half-point move. UK inflation rose to 3.5% in September, and the committee now expects around 5% by the middle of next year as energy prices feed through, before a fall as that effect fades.

The committee said it has seen limited evidence of knock-on effects on other prices and wages, but that pipeline pressure and stronger activity justified the rise. It stressed that policy is not on a pre-set path. Sanjay Raja of Deutsche Bank said he did not expect a long hiking cycle, and forecast one more rise to 4.25% in December or February. The next decision is on 17 December.