(MENAFN) The Bank of England on Thursday opted to maintain its benchmark interest rate at 4%, aligning with analysts’ expectations.

This decision follows the bank’s recent pause after ending a series of five consecutive rate cuts in September.

The Monetary Policy Committee reached the decision with a narrow 5-4 vote. Five members supported keeping the rate unchanged, while four favored a 25 basis point reduction.

"Consumer price index (CPI) inflation is judged to have peaked. Progress on underlying disinflation continues, supported by the still restrictive stance of monetary policy," the Bank of England said in a statement.

The central bank added, "This is reflected in an easing of pay growth and services price inflation. Underlying disinflation is being underpinned by subdued economic growth and building slack in the labour market."

The bank emphasized that monetary policy is being calibrated to balance risks around sustaining the 2% inflation target. It noted that the likelihood of inflation remaining high has recently fallen, while the risk of weaker demand pushing inflation lower has grown, creating a more balanced outlook.

"But more evidence is needed on both," the statement stressed. The Bank of England also said that the pace and scale of future rate cuts will depend on how inflation trends evolve.

"If progress on disinflation continues, Bank Rate is likely to continue on a gradual downward path," it added.

Annual consumer inflation in the UK held steady at 3.8% in September, unchanged from August, but remained at its highest level since January 2024.

MENAFN06112025000045017169ID1110305037