Bank of England holds rates at 3.75%, warns of possible hikes, and overhauls bond sales

Unbiased summary

The Bank of England's Monetary Policy Committee voted 6-3 to keep interest rates at 3.75% on Thursday. The Bank warned that if the Middle East conflict persists, energy-driven inflation may force future rate rises. It also announced a change to its quantitative tightening programme: instead of selling long-dated gilts to private buyers, it will sell shorter-term debt directly to the Treasury and hold longer-term bonds until maturity. This unexpected move lowered government borrowing costs. Official figures showed UK inflation rose to 3.1% in August from 2.9% in July, with core inflation steady at 2.6%. The Bank said second-round effects of higher energy prices have yet to appear but remain a risk.

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Coverage by outlet

The Guardian left

Angle Frames the QT change as a controversial and potentially costly move for public finances, while linking war-driven energy prices to household impacts.

Bias Emphasises the 'loss' from selling gilts and the 'messy process' being simplified, highlighting critics from both left and right. It downplays the market's positive reaction and instead stresses consequences for the Treasury and future budgets. The second article focuses on inflation hitting households, omitting the market rally.

The Bank of England is shaking up its bond sales – why does it matter?

Bank of England holds interest rates at 3.75% but warns war could force future rises

The Independent centre-left

Angle Politicises the conflict by naming 'Trump's war in Iran' and links the Bank's warning to that political context, while noting the Budget timing.

Bias Emphasises the role of Donald Trump in the Middle East conflict, framing the rate decision through a political lens. Omitted the QT overhaul and market reaction entirely. Focuses on the warning about future hikes and the upcoming Budget, suggesting a political narrative. Adds editorial tone with 'Trump's war' rather than neutral phrasing.

Bank of England warns interest rate rise ‘likely’ if Trump’s war in Iran continues

City AM centre-right

Angle Focuses on market reaction and financial implications, portraying the bond sale overhaul as a positive 'surprise' that boosts investor confidence.

Bias Highlights falling yields and FTSE 100 gains, framing the policy as market-friendly. It omits discussion of public finance costs or household impacts. Emphasises the hawkish split on the MPC, but does so in a technical, market-oriented way. Strays less from facts but has a pro-market slant.

Borrowing costs fall after Bank of England ‘surprises’ markets with bond sale change

Bank of England holds interest rates and overhauls bond sale programme

As it happened: FTSE 100 soars after Bank of England holds interest rates

Daily Mail right

Angle Emphasises the danger of future rate hikes and the pressure on borrowers, while noting other central banks are raising rates.

Bias Completely omits the bond sale overhaul, focusing solely on the hold and warning. It downplays the market reaction and frames the decision as cautious amid rising inflation. The tone is consumer-focused, stressing potential pain for households and businesses. It omits the QT change, a significant factual development.

Bank of England holds rates at 3.75% but warns borrowing costs may need to rise in coming months amid inflation fears