Bank of England raises Bank Rate to 4% in an 8–1 vote as energy prices climb

The Bank of England’s Monetary Policy Committee raised Bank Rate by 0.25 percentage points to 4% at its meeting ending on 4 November 2026. The decision was published on 5 November.

The vote

Eight members voted for the rise: Andrew Bailey, Sarah Breeden, Swati Dhingra, Megan Greene, Clare Lombardelli, Huw Pill, Dave Ramsden and Alan Taylor. Catherine L Mann voted against, preferring an increase of 0.5 percentage points to 4.25%.

Why the committee moved

The committee said global energy prices have kept rising from an already elevated level, with the conflict in the Middle East now in its ninth month. UK CPI inflation rose to 3.5% in September, and direct energy effects contributed around 1 percentage point of that, according to the minutes.

Bank staff now project headline inflation of around 4½% in the first quarter of 2027 and around 5% in the second quarter. The committee expects inflation to fall after that as the effect of higher energy prices on 12-month rates fades.

The minutes say the front-month Brent crude futures contract averaged $108 per barrel, and UK front-month natural gas futures 216 pence per therm, over the 15 UK working days ending 27 October. Those averages were 38% and 81% higher than at the time of the July Monetary Policy Report.

The committee said there is still limited evidence of knock-on effects on other prices and wages, but that the inflationary pressure in the pipeline is now enough to warrant a rise. It added that recent activity data have generally been stronger than expected.

What it means for traders

The committee said policy is not on a pre-set path and that it will adjust Bank Rate as necessary to return CPI inflation to the 2% target in the medium term. It named underlying pay, pricing behavior and slack as what it will be monitoring. Traders holding sterling positions overnight can see how rate changes feed into broker costs in our guide to swap rates and overnight financing.

What happens next

The Bank of England lists its next Bank Rate decision as due on 17 December 2026.