Rabobank’s RaboResearch notes the Bank of England kept rates unchanged while striking an “alert but careful” tone, with Governor Bailey describing an “active hold” that balances persistent inflation risks against softer activity and employment. The bank expects more MPC members to lean toward tightening in June, contingent on how energy costs from Gulf tensions feed through to broader UK inflation.

BoE balances inflation and growth risks

"Across the Channel, the Bank of England struck an “Alert but careful” tone, also holding rates steady."

"Governor Bailey described the stance as an “active hold,” balancing persistent inflation risks against growing concerns over employment and activity."

"That said, we expect more Monetary Policy Committee members to lean toward tightening in June."

"Ultimately, how far that shift goes will depend heavily on developments around the Strait of Hormuz and the extent to which higher energy costs feed through into broader inflation."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)