The Bank of England has elected to hold its benchmark interest rate at 3.75%.
The central bank’s Monetary Policy Committee voted 5-4 to keep rates on hold for the time being. Four committee members voted to lower interest rates by 25 basis points.
Economists polled by Reuters (TRI) had expected the vote to be 7-2 in favour of leaving interest rates unchanged.
The Bank of England previously cut interest rates last December, but economists had expected the central bank to move to the sidelines in February given persistent inflation.
The latest data showed that inflation in the United Kingdom was at an annualized 3.4% in December, above the central bank’s 2% target.
The Bank of England said that monetary policy is being set to ensure that the inflation rate “not only reaches 2% but remains sustainably at that level.”
The British currency, the Pound sterling, was trading 0.6% lower against the U.S. dollar immediately after the rate decision was announced.
Futures markets are pricing in three 25 basis point interest rate cuts from the Bank of England this year.
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