Bank of England’s latest decision on base rate

The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 5-4 to maintain the base rate at 4% at its November meeting⁽¹⁾.

Four members of the MPC had voted instead to reduce it to 3.75%.

In setting out the context to the vote, the MPC said: ‘Monetary policy is being set to balance the risks around meeting the 2% inflation target sustainably. The risk from greater inflation persistence has become less pronounced recently, and the risk to medium-term inflation from weaker demand more apparent, such that overall the risks are now more balanced. But more evidence is needed on both.’

The MPC pointed out that CPI inflation is judged to have peaked, and that underlying disinflation has generally continued, underpinned by subdued economic growth and building slack in the labour in the labour market.

It reported: ‘The extent of further reductions will therefore depend on the evolution of the outlook for inflation. If progress on disinflation continues, Bank Rate is likely to continue on a gradual downward path.’

Reacting to the decision, Dr David Crosthwaite, chief economist at BCIS, said: ‘Given that CPI is still almost double the Bank of England’s inflation target, it was no surprise that the MPC voted to keep interest rates at 4%. Despite the pre-Budget announcement earlier in the week, it seems the Bank of England is waiting to see what the actual impacts of the Budget might be before making any changes to the cost of borrowing.

‘The Chancellor suggested that she was concerned with inflation and hinted that the Budget might be deflationary, but clearly the Bank wants to see inflation coming down further before reducing interest rates again, as inflationary pressures remain particularly stubborn.’

The MPC’s next vote will be published on Thursday 18 December 2025.

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^{(1) Bank of England – Bank Rate maintained at 4% – November 2025 – here}