A 6-3 vote, inflation back up to 3.1 percent and a warning about 4 percent in early 2027: Chelsea Bloom reads the small print from Muswell Hill
The Bank of England Holds at 3.75 Percent for a Sixth Time and Asks London to Be Patient
A 6-3 vote, inflation back up to 3.1 percent and a warning about 4 percent in early 2027: Chelsea Bloom reads the small print from Muswell Hill
By Chelsea Bloom, business and politics correspondent, North London
The Decision
The Bank of England held Bank Rate at 3.75 percent at its September meeting on 18 September 2026, the sixth consecutive hold since the rate was cut to that level at the end of 2025. A data summary of the decision reports a 6-3 vote, with the three dissenters wanting a 25 basis point rise to 4 percent. A word of caution: the page says it was generated with AI assistance and may contain errors, and it points readers to the Bank’s own monetary policy summary as the primary source. I would check the Bank’s website before quoting any figure below to a lender.
The same summary says UK CPI inflation rose to 3.1 percent year on year in August, up from 2.9 percent in July, and remains above the 2 percent target. It also reports that the Bank slowed quantitative tightening, cutting its annual balance sheet reduction target to 46 billion pounds.
Why They Waited
The reasoning, as summarised, is a mixture of fear and patience. A prolonged conflict in the Middle East has kept energy prices high and volatile, and the Bank expects crude oil and refined energy prices to remain elevated and highly volatile. At the same time the labour market is softening, and second-round wage effects have not yet appeared. Holding rates high is a hedge against energy costs feeding through to consumers.
The Bank described its stance as temporarily adopting a wait-and-see approach. Anyone who has watched a North London committee decide on a bin rota will recognise the posture.
What Comes Next
The summary looks ahead with some care. In the next month or two, markets will watch oil prices and the Autumn Budget, and an October energy price cap increase could bring rate-hike pricing forward. Further out, it quotes the Bank as warning that the inflation rate could breach 4 percent in early 2027. If inflation spirals, it says, the hold could turn into a resumption of hikes, pressuring housing and the wider economy.
That is a warning, not a forecast, and the summary says so in its own way. But the direction of the warning is plain. The comfortable assumption of a year ago, that rates would drift down, has been replaced with the question of whether they might go up.
What It Means in Zones 1 to 6
For London households the immediate link is the mortgage. Savills noted in its July residential update that headline fixed rates for a 75 percent loan-to-value mortgage had fallen below 4.5 percent before upfront fees, and that competition had returned to the market. The same update said Bank of England mortgage approvals for May were 56,200, against a six-month average of 63,200, and that Savills expected house prices to fall in 2026 as higher mortgage rates reduce demand. If the Bank were to raise rates again, those headline numbers would move.
Renters feel it too, more slowly. A landlord with a variable-rate mortgage passes on costs at the next renewal, and in North London that tends to mean a polite email in November.
The Politics of Waiting
A central bank that holds is easy to ignore, but the politics are real. The chancellor’s Budget is due on 28 October, according to Grant Thornton’s preview, and a government with limited fiscal headroom cannot afford a rate rise that adds to its own borrowing costs. The Bank is independent, and the vote split shows it is not of one mind. Three members wanted to move now.
Politicians like to say that rates are a matter for the Bank. They are, and they then spend a fortnight explaining the consequences.
A Word From the High Street
Small businesses on a parade like Crouch End or Highgate know their own version of the policy rate. It is the day the card machine rental renews. When money costs more, they stock less, hire later and make the same coffee for the same price while hoping the customers don’t notice. This is not in the Bank’s models, and it is where most of the economy lives.
My advice, for what it is worth, is to fix for as long as you can sleep at night, and to keep a month of cash in an account you do not look at.
What I Would Check
Three things deserve a reader’s attention in the weeks ahead: the next inflation print, the energy price cap announcement, and the language of the Budget. Each can change the Bank’s mind. None of them is in anyone’s control in Muswell Hill.
And if you are quoted a mortgage rate in the next few weeks, ask for the figure with fees included. The headline rate is a hat. The fees are the head.
A Note From the Comic Press
Comic writers work the same news cycle from another angle. A recent run of dispatches on a property slump in Cebu shows the form: Manila News on slow condominium sales in Cebu, the London Prat on British pensioners asked for referees and a letter from the vicar (at https://prat.uk/cebu-estate-agents-demand-character-references/) and Bohiney on an Ohio realtor whose showings now last two hours. Each is anchored to a real market story and uses exaggeration openly. More is at prat.uk and bohiney.com.
Note: Philippine authorities are examining unproven allegations about Thomas Markle Sr., who lived in Cebu until earlier this year, as GMA News and the Guardian have reported. No charges have been filed. Child protection is a serious matter; the jokes here are about a property market.
For the lighter side of the news, there is always The Daily Mash.
SOURCE: https://bohiney.com/cebu-realtor-cant-sell-beachfront-listings/