London, 17 Sep 2026 – The Bank of England is expected to leave its Bank Rate unchanged at 3.75% when it meets at noon, while signalling a slower pace of quantitative tightening (QT). Analysts anticipate the central bank will cut annual gilt sales to roughly £50 billion, compared with the £70 billion sold over the past year, and may pause sales of long‑dated bonds that have pushed borrowing costs higher.
Inflation remains above the BoE’s 2% target, prompting market consensus that a rate hike is unlikely despite the possibility that three members of the Monetary Policy Committee could favour a rise. The labour market shows signs of strain: pay‑rolled employment is falling, real‑term wage growth is negative and job vacancies sit at a multi‑year low.
July’s GDP growth exceeded expectations, driven largely by AI‑related capital expenditure, while construction and manufacturing output contracted. The United States Federal Reserve raised its policy rate the day before, adding pressure on the BoE to maintain policy independence.
Criticism of the QT programme has intensified. The Reform party has accused the Bank of imposing losses on taxpayers, and a recent Guardian analysis warned that the UK is the only major central bank still selling bonds in this manner, effectively turning monetary decisions into fiscal ones. BoE Governor Andrew Bailey described the overall cost of QT as “neutral” when viewed over six decades, a point highlighted by economist Patricia Pino.
The BoE’s decision on QT is viewed as more consequential than the rate decision, with market participants watching for any shift that could ease pressure on future rate moves.
Key upcoming data: Eurozone August inflation at 10 am BST, US initial jobless claims at 1.3 pm BST.
