The Bank of England has held interest rates at 5.25 per cent today, dashing hopes of homeowners and Rishi Sunak of helpful pre-election cut.
The bank’s Monetary Policy Committee (MPC) voted 7-2 to keep the rate steady, meaning there will be no reduction in the rate before August at the earliest.
Most economists had expected the policymakers to hold rates a day after official figures showed that inflation returned to the 2 per cent target last month, for the first time since July 2021.
Rishi Sunak declared ‘we’ve got there’ after the milestone was confirmed, insisting that it shows the economy has ‘turned the corner’ after a long stretch of above-target inflation.
It raised questions over whether interest rates, which are used by the central bank as a tool to control inflation, could now be eased.
But experts cautioned that a rate cut this summer could be less likely until the majority of the MPC feel certain that inflation is under control.