What is the Bank of England's expected decision on interest rates at its June 18 meeting, and what is the consensus among economists about the rest of 2025?

The Bank of England is expected to hold its key interest rate unchanged at 3.75% on June 18, according to all 65 economists polled by Reuters; the median forecast in the June 5–12 poll indicates Bank Rate will remain at that level through the rest of 2025, though nearly 40% of respondents predicted at least one hike and only six expected a 25-basis-point cut by year-end.

What are the main drivers behind rising concerns about inflation and potential interest rate hikes in the UK, according to the news?

Rising concerns stem from persistent energy price pressures linked to the U.S.-Israeli war with Iran, which has driven up oil prices, disrupted shipping through the Strait of Hormuz, and created spillover price pressures across the economy; Governor Andrew Bailey emphasized the need to return inflation to the 2% target, while policymaker Megan Greene cited the prolonged Middle East conflict as strengthening the case for a rate rise, and Deutsche Bank’s Sanjay Raja noted the 'duration of the energy shock is becoming non-negligible' and risks are skewed toward tightening if energy prices remain elevated.

Bank of England Expected to Hold Interest Rates Amid Energy Price Risks

Jun 12, 2026

Economists predict the Bank of England will maintain rates at 3.75% this year, though rising energy costs and geopolitical tensions could drive oil prices above $100 per barrel and trigger future rate hikes.

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