The interest rate decision at the Bank of England March 2025

The Bank of England left interest rates unchanged on Thursday, as the British economy contradicts with uncertainty about global trade and stagnation that is looming at home.

The widespread expected decision maintains the standard interest rate of the central bank by 4.5 %.

In a statement, the Central Bank said that the monetary policy committee voted in favor of leaving prices unchanged by a majority of 8-1. One of the MPC members voted to reduce a 25-basis point.

The statement said, “Since the previous meeting in favor of MPC, the intensification of uncertainty in the World Trade Policy, and the United States has provided a set of customs tariffs advertisements to which some governments have responded,” the statement said.

“Other geopolitical uncertainties have increased and indicators of financial market fluctuations increased worldwide.”

The decision comes at a time of potential economic opposite winds abroad and at home. At the global level, this includes repeated transformations, a lack of clarity and conflict surrounding the commercial tariffs of US President Donald Trump, as well as its potential impact on inflation in the UK and economic growth.

The British economy showed signs of weakness, as it contracts 0.1 % over a month in January.

the Boy in February To half its growth expectations for the year 2025 for the United Kingdom to 0.75 %.

On Thursday, the Central Bank said that recent business indicators indicate a weakness in economic growth and employment intentions.

In February, he said it was so expected Increase the increase in inflation to 3.7 % in the third quarter of this year, where energy costs are accelerated. UK inflation rose sharply to a hotter temperature to 3 % in January.

In the future, the central bank said that based on its medium -term expectations of inflation, “a gradual and accurate approach to more withdrawal of monetary policy restrictions is appropriate.”

However, the Bank of England has noticed that this depends on how the economy evolves to move forward.

“If there is a greater or longer weakness than the demand for demand, this may lead to a decrease in inflationary pressures, which calls for a less restricted path to the banking rate,” she said.

“If there is more bound supply to the demand and more stability in wages and local prices, including the second effects related to the near -term increase in the inflation of the consumer price index, this will guarantee the relatively most affordable monetary policy course.”

After the decision, the British pound fell 0.3 % against the dollar by 12:28 pm in London.

Meanwhile, the return on British government bonds – known as Gilts – decreased less. The return of 10 years Gilts was the last of more than four lower basis points.

A meeting on Thursday a few days before the start of the US government’s tax changes, which have proven to be unimportant with companies, which says that the growing tax burden may be scattered on growth, investment and jobs.

“Spring Statement” in the United Kingdom, during which British Chancellor Rachel Reeves will submit an update of its plans for the British economy, on March 26. The Minister of Finance is under pressure to reduce public spending, raise taxes, or to fold the financial rules imposed on the government, amid higher borrowing costs.

This is an urgent news story, please check again for updates.

– This report at CNBC’s Holly Ellyatt and Chloe Taylor contributed to this report.