The Bank of England held interest rates steady at 3.75 percent on Thursday, maintaining its position as an outlier among global central banks. Policymakers kept the rate unchanged despite inflation rising to 3.1 percent in August, the fastest pace since March, driven by higher gasoline and diesel prices. Governor Andrew Bailey stated that while higher global energy costs have had a limited effect so far, persistent volatility will increase inflationary pressure.

Inflation is forecast to reach slightly above 4 percent in early 2027, double the bank's 2 percent target. Three members of the nine-person rate-setting committee voted for a quarter-point increase, including Chief Economist Huw Pill, arguing the bank could wait to assess the war's impact. The decision follows rate hikes by the U.S. Federal Reserve and European Central Bank, with the Bank of Japan expected to follow suit.

Policymakers face a balancing act between restraining inflation and supporting economic growth, especially as energy prices remain elevated and average household energy bills are set to increase 4 percent next month.