UK Monetary Policy Report - April 2026

Our Monetary Policy Committee (MPC) decides what monetary policy action to take. The MPC sets and announces policy eight times a year (roughly once every six weeks). In this video, the MPC discusses the decisions taken in April 2026 and answers questions from the press.

At its meeting ending on 29 April 2026, the Monetary Policy Committee (MPC) voted by a majority of 8–1 to maintain Bank Rate at 3.75%. One member voted to increase Bank Rate by 0.25 percentage points, to 4%. The conflict in the Middle East means that prospects for global energy prices are highly uncertain. Monetary policy cannot influence energy prices but will be set to ensure that the economic adjustment to them occurs in a way that achieves the 2% inflation target sustainably. The policy stance required to achieve this will depend on the scale and duration of the shock, and how it propagates through the economy. The April Monetary Policy Report sets out three scenarios that help to illustrate a range of possible outcomes for the UK economy. CPI inflation has increased to 3.3%, and is likely to be higher later this year as the effects of higher energy prices pass through. There is a risk of material second-round effects in price and wage-setting, which policy would need to lean against. But the labour market continues to loosen, and a weak Just in | BoE: Slower economy and labor market, along with tighter financial conditions, expected to gradually decrease inflation. Just in | The Bank of England warns of potential significant second-round effects from inflation on wage and price-setting, indicating a need for policy adjustments to mitigate these risks. Just in | Bank of England releases new forecasts based on three scenarios for energy prices and inflation, without updating central economic projections. Bank of England signals interest rate hikes ahead despite April hold The Bank of England has all but confirmed that interest rates will be hiked in the coming months as oil prices have shot up, despite opting to hold them in a meeting on Thursday. The Bank’s Monetary Policy Committee warned interest rates could climb back to 5.25 per cent from the current level of 3.75 per cent, cancelling all six interest rate cuts seen over the last two years. This sharp change in the direction of interest rates would take place in a scenario where oil prices exceed $130 per barrel and sustain high levels for the next year and a half. Its updated forecasts suggested inflation would exceed six per cent while growth would also suffer a hit.

BoE Gov. Bailey: Monetary policy cannot prevent higher global energy prices from affecting UK economy and inflation. BOE'S BAILEY SAYS WE NOW PROJECT INFLATION WILL RISE TO A LITTLE OVER 3.5% BY END OF YEAR || SAYS INITIAL INDIRECT EFFECTS OF INFLATION ARE LIKELY TO BE LARGEST FOR FOOD PRICES BOE'S BAILEY SAYS THE LONGER THE CONFLICT IN MIDDLE EAST LASTS, THE WORSE THE IMPACT WILL BECOME BoE Gov. Bailey: The sheer volatility of energy prices makes it impossible to put probabilities on different scenarios.