Bank of England Policy Announcement (17th Sep. 2026)

For more detailed and up to date analysis, see here. 

The Bank of England left interest rates at 3.75% today and announced that it will reduce its holding of gilts by £368bn over the next eight years, but most importantly it suggested it is close to no longer being able to grin and bear the rise in energy prices. Unless energy prices fall back and a resolution to the Middle East occurs, it now feels as though the Bank will hike interest rates to 4.00% at the next policy meeting in November. This is a change to our previous forecast of no hikes, and we’re also putting in a second 25bps hike to 4.25%. We still think, though, that rates won’t rise as far as the 4.75% investors expect.