At its meeting on 4 November 2026, the Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8–1 to increase the Bank Rate by 0.25 percentage points, setting it at 4 %. One member preferred a larger rise of 0.5 percentage points to 4.25 %.
September 2026 CPI inflation rose to 3.5 %, with direct energy effects accounting for roughly one percentage point. The Committee expects headline CPI to climb to around 5 % by the middle of next year before easing as the impact of higher energy prices on 12‐month inflation fades.
Energy markets remain volatile. Over the 15 UK working days to 27 October, front‐month Brent crude averaged $108 per barrel and UK natural‐gas futures averaged 216 pence per therm. These levels were 38 % and 81 % higher, respectively, than at the time of the July Monetary Policy Report and also exceeded the July Report’s adverse‐scenario futures‐price assumptions by 5 % and 27 %.
Bank staff’s near‐term inflation projection, based on the same energy‐price window, forecasts headline CPI at around 41⁄2 % in the first quarter of 2027 – about 11⁄4 percentage points above the July Report’s estimate – and near 5 % in the second quarter of 2027.
The Bank’s Market Participants Survey shows the median expected path for the Bank Rate has risen to 4 % in November and is projected at 4.25 % in February, still below the short‐term interest‐rate curve. Benchmark two‐year mortgage rates have risen by almost 50 basis points since early September, and the Committee expects mortgage rates to approach 5 % by mid‐next year.
While monetary policy cannot directly influence global energy prices, the MPC will continue to adjust the Bank Rate as needed to bring CPI inflation back to its 2 % target in the medium term, monitoring for second‐round effects in wages and prices.
The Committee also noted that the recent UK Budget measures are expected to cut CPI inflation by about 0.25 percentage points by 2027 Q2, though fiscal stance remains a drag on medium‐term growth.