Stories

Wed, 16 Sep 2026

Wed, 16 Sep 2026 Interest rates hold expected but Bank of England facing tough choices

Forecasts of further rises in the inflation rate mean some analysts expect the Bank to act by the end of the year.

* Accelerating global energy prices and inflation rate of 3.1% in August, highest in six months
* Economists expect higher global energy costs will feed through to food and fuel prices, keeping inflation above target for some time
* European Central Bank raised interest rates to 2.5% due to Middle East conflict and US Federal Reserve raised its interest rate to 3.5%-3.75%
* Average two-year fixed residential mortgage rate at highest since May 11, with five-year average also at a high
* Savers may be offered more generous returns but spending power could be eroded by rising cost of living