What changed in the Bank of England statement — 17 September 2026

Bank of England held policy at 3.75%. The vote was 6-3. Since the July meeting the inflation picture has deteriorated rather than improved — CPI has climbed to 3.1% and the Committee now says the risks are skewed further to the upside — and it has paired that with an explicit commitment to shrink its government bond holdings to zero, so the overall direction of travel is toward tighter, not looser, policy. The rate itself is unchanged and the vote split is unchanged, whic

Decision

Decision: hold
Bank Rate: 3.75%
Vote: 6-3

Going into the decision

On the day, the committee read as hawkish — 1.1 on a scale where +3 means every member wants higher rates and −3 means every member wants cuts.

Reconstructed from official member remarks published before the decision date. 9 of 9 active members had stored official remarks.

What changed

Since the July meeting the inflation picture has deteriorated rather than improved — CPI has climbed to 3.1% and the Committee now says the risks are skewed further to the upside — and it has paired that with an explicit commitment to shrink its government bond holdings to zero, so the overall direction of travel is toward tighter, not looser, policy. The rate itself is unchanged and the vote split is unchanged, which means the next move almost certainly hinges on whether the anticipated pass-through from higher energy prices confirms their second-round-effects concern, with an increase in Bank Rate more plausible than a cut unless that pass-through clearly fades.

Inflation — More hawkish. Inflation is now 3.1% and expected to rise further across coming quarters — a sharp upgrade from July's 2.6% reading — while the Committee says the upside risk balance has deteriorated 'more so than at the time of the July Monetary Policy Report' and that policy must be ready to 'lean' against second-round effects.
Labour Market — Little changed. The disinflationary labour-market argument has weakened rather than reversed: softening conditions and higher household and business interest rates are still cited as forces that will 'act to reduce inflation over time', but July's emphasis on 'clear signs of underlying disinflation' has been dropped and activity is now described as slightly stronger than expected, shifting this axis from dovish to genuinely two-sided.
Rate Path — More hawkish. Bank Rate is again held at 3.75% by the same 6–3 majority and the 'stands ready to act' guidance is repeated verbatim, but the three dissents are now framed explicitly as votes for an immediate hike to 4% and the risk balance behind the conditional guidance has hardened — a tightening bias with no change in the delivered setting.
Balance Sheet — More hawkish. A new and unanimous decision to run the government bond portfolio held for monetary policy purposes down to zero, unwinding the remaining stock at an annual average pace of £46bn through £20bn of active sales plus maturing gilts out to 2034, adds a persistent background tightening impulse that was absent from the July signal set.

Previous wording

At its meeting ending on 29 July 2026, the Monetary Policy Committee (MPC) voted by a majority of 6–3 to maintain Bank Rate at 3.75%. Three members voted to increase Bank Rate by 0.25 percentage points, to 4%.
rate path: 6-3 vote shows three hawks want a hike, but the hold is the base case.

Monetary policy cannot influence energy prices but is being set to ensure that the economic adjustment to them occurs in a way that achieves the 2% inflation target sustainably. The policy stance required to achieve this will depend on the scale and duration of the shock, and how it propagates through the economy including via financial conditions.
rate path: Forward guidance is conditional on the persistence and transmission of the energy shock.

CPI inflation has fallen to 2.6% since the previous meeting, although it is expected to rise later this year as the effects of higher energy prices continue to pass through.
inflation: Inflation is below the prior level but set to rebound, leaving the near-term path ambiguous.

The risk of material second-round effects in price and wage-setting, against which policy needs to lean, is greater the longer higher energy prices persist.
inflation: Explicit mention of leaning against second-round effects signals a tightening bias if persistence persists.

There is little evidence so far to suggest such effects, and there have continued to be clear signs of underlying disinflation in recent data.
inflation: Lack of second-round effects and disinflation momentum reduce the urgency to hike.

Loose labour market conditions, and higher interest rates faced by households and businesses than prior to the conflict, will also act to reduce inflation over time.
labour market: Labour market slack and tighter financial conditions are disinflationary forces supporting patience.

The Committee judges that the risks to the inflation outlook are tilted to the upside relative to the central projection in the July Monetary Policy Report, but there remains scope for the outlook to change materially as events in the Middle East unfold.
inflation: Upside inflation risk but with material uncertainty from the Middle East, keeping the bias conditional.

The Committee judges that it is appropriate to maintain Bank Rate at this meeting. The Committee stands ready to act as necessary to ensure that CPI inflation remains on track to meet the 2% target in the medium term.
rate path: Policy on hold but with a clear 'ready to act' signal, leaving the next move data-dependent.

Current wording

At its meeting ending on 16 September 2026, the Monetary Policy Committee (MPC) voted by a majority of 6–3 to maintain Bank Rate at 3.75%.
rate path: Bank Rate held at 3.75% by a 6–3 majority, with no immediate policy change.

Three members voted to increase Bank Rate by 0.25 percentage points, to 4%.
rate path: Three dissenting votes for an immediate hike signal a hawkish minority on the Committee.

UK CPI inflation increased to 3.1% in August and is likely to rise further over coming quarters.
inflation: Inflation is above target and expected to rise further, supporting a hawkish hold.

There has been little evidence so far of material second-round effects in price and wage-setting. However, the risk of such effects, against which policy needs to lean, is greater the longer higher energy prices persist or are more volatile.
inflation: No second-round effects yet, but the MPC explicitly wants to lean against them if energy prices persist.

Overall, the Committee judges that the risks to the inflation outlook are tilted to the upside, and more so than at the time of the July Monetary Policy Report, although there remains scope for the outlook to change materially as events in the Middle East unfold.
inflation: The inflation risk balance has deteriorated since July, reinforcing hawkish concern.

Activity has been slightly stronger than expected, although soft labour market conditions, and the higher interest rates faced by households and businesses since the conflict began, will act to reduce inflation over time.
labour market: Soft labour market and higher rates are disinflationary offsets, but stronger activity is a countervailing signal.

The Committee stands ready to act as necessary to ensure that CPI inflation remains on track to meet the 2% target in the medium term.
rate path: Explicit readiness to act keeps a tightening bias if inflation risks materialise.

At this meeting, the MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, to zero.
balance sheet: Unanimous unwind of the APF gilt portfolio to zero confirms continued QT as a background tightening impulse.

This will be conducted through a multi-year plan, such that the remaining stock is unwound at an annual average pace of £46 billion by the end of 2034, through annual sales of £20 billion alongside maturing gilts.
balance sheet: QT pace details: £46bn annual average unwind and £20bn active sales are key for gilt supply expectations.

Official statement

Monetary Policy Summary, September 2026

At its meeting ending on 16 September 2026, the Monetary Policy Committee (MPC) voted by a majority of 6–3 to maintain Bank Rate at 3.75%. Three members voted to increase Bank Rate by 0.25 percentage points, to 4%.

Protracted conflict in the Middle East has contributed to further increases in crude and refined energy prices since the previous meeting, which remain more volatile and higher than pre-conflict. UK CPI inflation increased to 3.1% in August and is likely to rise further over coming quarters. Monetary policy is being set to ensure inflation comes down to 2% sustainably as the economy adjusts to the energy shock. The policy stance required to achieve this will depend on the scale and duration of the shock and how it propagates through the economy.

There has been little evidence so far of material second-round effects in price and wage-setting. However, the risk of such effects, against which policy needs to lean, is greater the longer higher energy prices persist or are more volatile. Activity has been slightly stronger than expected, although soft labour market conditions, and the higher interest rates faced by households and businesses since the conflict began, will act to reduce inflation over time. Overall, the Committee judges that the risks to the inflation outlook are tilted to the upside, and more so than at the time of the July Monetary Policy Report, although there remains scope for the outlook to change materially as events in the Middle East unfold.

The Committee judges that it is appropriate to maintain Bank Rate at this meeting. The Committee stands ready to act as necessary to ensure that CPI inflation remains on track to meet the 2% target in the medium term.

At this meeting, the MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, to zero. This will be conducted through a multi-year plan, such that the remaining stock is unwound at an annual average pace of £46 billion by the end of 2034, through annual sales of £20 billion alongside maturing gilts.

Read the official source

Full meeting record · Press conference transcript · Side-by-side comparison · Previous statement

Background reading

Cadence's comparison is generated from the official documents. Read the methodology.