Photo: N Chadwick, Wikimedia Commons, CC BY-SA 2.0 (file photo of the Bank of England on Threadneedle Street).
LONDON — Friday, Nov. 6, 2026. The Bank of England’s Monetary Policy Committee has lifted Bank Rate to 4.00%, its first increase since cutting to 3.75% in December 2025, citing a protracted Middle East energy shock that is pushing UK inflation higher even as second-round wage effects remain limited so far.
In the Monetary Policy Summary published Nov. 5 for the meeting that ended Nov. 4, the MPC voted 8–1 to raise Bank Rate by 0.25 percentage point to 4%. Eight members backed the quarter-point move; Catherine L. Mann preferred a half-point jump to 4.25%. Official Bank Rate history on the Bank’s database confirms the new 4.00% level effective Nov. 5, 2026, after 3.75% had stood since Dec. 18, 2025.
What the data shows
The Official Bank Rate series shows a long easing arc from 5.25% in August 2023 down to 3.75% in December 2025 — then Friday’s published decision reverses the last cut. TBR calculations from the Bank’s history table put the cumulative decline from the August 2023 peak to the December 2025 trough at 150 basis points; the Nov. 5 hike reclaims 25 bp of that easing. UK CPI inflation was 3.5% in September and is projected in the Summary to rise to around 5% by the middle of next year before falling as energy base effects fade and restrictive policy bites.
Energy shock, limited second-round evidence
The Summary states that the Middle East conflict is in its ninth month and that global energy prices have continued to rise from already elevated levels. Over the 15 UK working days ending Oct. 27, front-month Brent averaged $108 per barrel and UK front-month natural gas futures averaged 216 pence per therm — 38% and 81% higher, respectively, than at the July Monetary Policy Report, and above the Report’s adverse-scenario Q4 assumptions.
Direct energy effects contributed about 1 percentage point to September CPI, mostly via fuels. The Committee said there is still limited evidence of knock-on effects on other prices and wages, but judged that pipeline inflation pressure is now large enough to warrant a higher Bank Rate. Activity data have generally been stronger than expected, adding to the case for modestly tighter policy. Mortgage rates have already moved: benchmark two-year mortgage rates had risen nearly 50 basis points since early September, the minutes note.
Why it matters for the Federal Reserve and U.S. markets
Threadneedle Street’s hike lands in the same global energy cycle that U.S. policymakers are debating after October’s strong payrolls print. Readers of our Federal Reserve tracker and U.S. economy pages will recognize the same tension: energy-led inflation versus still-uneven evidence of broader pass-through. The Bank stressed that policy is not on a pre-set path and that members will watch pay, pricing behavior and slack — language that rhymes with how FOMC speakers have framed “higher for longer” risks without locking in a December move.
For sterling assets and UK banks, a return to 4% raises deposit and loan pricing immediately. For global business news desks, it is another G10 central bank leaning against an energy shock rooted in the same conflict tracked on our Iran war pages. Mann’s lone dissent for 50 bp underscores how some members see credibility and non-linear inflation risks — the Summary cites staff projections for CPI near 4.5% in 2027 Q1 and around 5% in 2027 Q2 on the energy path used to Oct. 27.
What comes next
The next MPC decision is due Dec. 17, 2026. Markets had already marked a higher path into this meeting; the minutes say the Market Participants Survey median expected 4% in November and 4.25% in February. Whether December brings another hike will hinge on energy futures, wage settlements and whether Friday’s European gas selloff — TTF down 15.5% on the week in separate market reports — sticks or reverses. For now, Bank Rate is back at 4%, and the Bank has telegraphed that insurance against second-round effects is no longer optional.
Sources
- Bank of England — Monetary Policy Summary and Minutes, November 2026
- Bank of England — Official Bank Rate history
- Anadolu Agency — European gas prices weekly drop (Nov. 6, 2026)
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