The Bank of England has held its main interest rate at 3.7 per cent as the inflation pressures on the British economy become more benign after the US and Iran signed a deal to sign deal to end their war.
Thursday’s decision was widely anticipated after figures showed inflation did not rise as had been expected in May, holding steady instead at 2.8 per cent.
Though that remains above the bank’s target of two per cent, it raised hopes that the upward pressure on prices emanating from the spike in oil and gas prices after the start of the Iran war on February 28 might have been less than anticipated.
Economists think rate-setters will opt against hiking rates over coming months, but only if the recent fall in energy prices is sustained.
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