Bank of England raises rates to 4% and signals further increases as UK inflation climbs

Timeline newest first

1. Nov 14, 2026Huw Pill, the Bank of England's chief economist, told the Financial Times that more than one further interest rate rise was almost certain.
2. Nov 14, 2026An estimated 2.3 million UK homeowners are due to refinance their loans in 2027 and face a sharp rise in mortgage payments.
3. Nov 11, 2026The National Institute of Economic and Social Research warned the Bank's hesitant response risks higher interest rates for longer and forecast UK inflation staying above the 2% target until at least 2030.
4. Nov 5, 2026The Bank of England raised its base rate from 3.75% to 4% on 5 November 2026, its first increase since August 2023.
5. Nov 5, 2026Money markets priced a 98% chance of a quarter-point Bank of England rise ahead of the 5 November 2026 decision.
6. Nov 5, 2026UK inflation, as measured by the Consumer Prices Index, reached 3.5% in the year to September 2026, up from 3.1% the previous month.
7. Nov 4, 2026S&P Global's October survey showed UK services sector growth jumping to an eight-month high, with the first hiring after two years of job cuts.

Sources newest first

• A rapid interest rate rise seems inevitable – and households are expected to pick up the tabtheguardian.com· 18h

  Phillip Inman's Guardian Viewpoint column argues a rapid Bank of England rate rise is inevitable, possibly as soon as the 17 December meeting, with households picking up the tab through costlier mortgages and loans. Citing Huw Pill's comment that more than one rise is almost certain, he blames runaway public projects like the £11bn lower Thames crossing and £3.7bn consultant spending for fuelling inflation, and urges the public sector to push back.
• Interest rate rises likely in coming months, Bank of England economist saystheguardian.com· 22h

  A Guardian report says a Bank of England economist, Huw Pill, expects further interest rate rises in December 2026 and early 2027 to fight inflation, which is forecast to reach 5% in spring 2027. City analysts see a December rise as almost inevitable, though some worry higher rates will hurt manufacturing and construction.
• Bank of England’s inflation response ‘risks higher interest rates for longer’theguardian.com· 4d

  The Guardian reports that the Bank of England raised borrowing costs from 3.75% to 4% amid UK inflation of 3.5%, driven by oil and gas prices that have climbed since the US and Israel launched their war on Iran, with Brent crude trading above $100 a barrel against about $70 before the war. The National Institute of Economic and Social Research says the hesitant response risks higher interest rates for longer, forecasts inflation staying above the 2% target until at least 2030, criticises chancellor John Healey for deferring difficult budget decisions, and director David Aikman urges the Bank to act more aggressively.
• Bank of England Raises Rates for First Time in Three Yearsnytimes.com· 9d

  The New York Times reports that the Bank of England raised its key rate by a quarter point to 4 percent, its first increase in more than three years, joining other central banks fighting inflation driven by higher energy prices from the nine-month war in Iran. Governor Andrew Bailey said the hike shouldn't be seen as the first in an inevitable long sequence, though the bank forecast inflation climbing to about 5 percent the following year.
• Bank of England raises interest rates to 4%, the first increase for more than three yearstheguardian.com· 9d

  The Guardian reports the Bank of England raised its base rate from 3.75% to 4%, its first increase in more than three years, to combat rising inflation after UK consumer prices hit 3.5% in September, well above its 2% target. It says the move was widely expected, links oil prices above $100 to the Iran war, and warns higher rates could hit more than 2 million mortgage borrowers refinancing over the next year.
• Bank of England expected to raise interest rates for first time in three years today – business livetheguardian.com· 10d

  The Guardian's business live blog tracks the Bank of England's widely expected first rate rise in more than three years, with markets pricing a 98% chance of a quarter-point hike to 4% at noon. PIMCO's Peder Beck-Friis says the Bank is mainly responding to higher energy prices, while Berenberg's Andrew Wishard predicts an 8-1 vote, and the blog notes oil has tumbled below $100 a barrel after the US midterms.
• UK interest rates: Bank of England expected to raise them for first time in over three yearsbbc.com· 10d

  A BBC article by Kevin Peachey says the Bank of England is expected to raise interest rates from 3.75% to 4% at its Thursday decision — the first increase since August 2023 — as UK inflation climbed to 3.5% in September, driven by petrol, diesel and the Iran war's effect on energy costs. Analysts quoted expect the rise to hit borrowers, including a £31 monthly increase for typical tracker mortgages, while savers could see better rates, and CMC Markets' Chris Cheverall says the decision is now less about reaching 4% than what follows.
• UK interest rates increase expected after services sector activity acceleratestheguardian.com· 10d

  A Guardian article reports that UK services sector growth jumped to an eight-month high in October, with the S&P Global survey showing a rebound in new orders, the first hiring after two years of job cuts, and strength tied to AI and datacentre spending. The Bank of England is expected to raise rates by 0.25 percentage points to 4% on Thursday, after inflation rose to 3.5% in September, and markets anticipate three further increases.

Background newest first

• UK economy grows by 0.7% in third quarter despite high oil pricestheguardian.com· 3d

  The Guardian reports UK GDP grew 0.7% in the third quarter, in line with City forecasts, though the Office for National Statistics said rising petrol, diesel and natural gas costs after the Middle East conflict re-escalated restricted growth, and it revised August's expansion to zero. The article adds that Bank of England policymakers raised rates to 4% and judges the Office for Budget Responsibility's 1.2% forecast out of date as growth keeps beating expectations.
• UK economy grew by 0.7% in third quarter, the fastest rate for two years - follow livebbc.com· 3d

  The BBC's live report says Office for National Statistics figures show the UK economy grew by 0.7% between July and September, the fastest quarterly growth in more than two years, driven largely by services while construction shrank. Faisal Islam and Dharshini David write that growth defied fears of a hit from the Middle East war, though both caution that high energy bills could slow momentum in coming months.
• Young people in UK hit by ‘low-gear economy’, warns Bank of England deputytheguardian.com· 5d

  The Guardian interviews Clare Lombardelli, the Bank of England's deputy governor, who warns that young Britons are bearing the brunt of a 'low-gear economy': employers freezing hiring but not firing, hurting newcomers to the jobs market in sectors like retail and hospitality. Youth unemployment has hit its highest level outside the pandemic since 2015, nearly a million young people are not in education, employment or training, and Lombardelli says a further rate rise in December is plausible.
• Britain’s housing market unlikely to recover until 2028, says Savillstheguardian.com· 11d

  Savills forecasts Britain's sluggish housing market will not recover until 2028, with prices drifting lower through 2026, falling 1.5% in 2027, then rising 15.8% — about £56,500 on average — over the five years to 2031. Emily Williams of Savills says the Middle East conflict is keeping mortgage rates high, while Nationwide reports annual house price growth of just 0.5% in October, to an average of £273,566, and UK inflation rose to 3.5% in September.