The MPC was split five to four in favour of the hold, with four members preferring to cut rates by 0.25 per cent to 3.75 per cent.

Although inflation has remained steady at 3.8 per cent for the past three months, it is still above the Bank's 2 per cent target. Andrew Bailey, the Bank of England governor, said he wanted to wait and see whether inflationary pressures would continue to fade and whether the UK Chancellor of the Exchequer's Autumn Budget would have an impact. “We still think rates are on a gradual path downwards, but we need to be sure that inflation is on track to return to our 2 per cent target before we cut them again,” he said. 

Here are some reactions from wealth managers to the decision.

Isaac Stell, investment manager at Wealth Club
“By keeping rates unchanged in the weeks leading up to the Budget, the BoE appears reluctant to let the government off the hook for fiscal responsibility. In her pre-budget speech, the Chancellor all but confirmed that taxes will have to rise. This fiscal tightening will likely do the heavy lifting for the BoE when it comes to fighting inflation, although perversely the previous budget both tightened fiscal policy and increased inflation. Reeves will be reluctant to make that same mistake twice. This should give the BoE sufficient cover to console a beleaguered UK consumer in the form of a pre-Christmas rate cut.”

Andrew Zanelli, head of technical engagement at Aberdeen Adviser
“Today’s decision to hold interest rates was expected and shouldn’t cause any market reaction. Whilst the decision provides some continuity, consumers have been dealing with Autumn Budget speculation and predictions on an almost daily basis for some time now. They may need to reassess their financial plans as a result and this is when professional financial planners and advisors prove their worth. By speaking to an advisor, consumers can not only understand what’s going on but also consider their choices within a longer-term strategy and make sure their money is working as hard as it possibly can.”

Simon Dangoor, deputy CIO of fixed income at Goldman Sachs Asset Management
“We think the MPC is on course to cut in December assuming incoming data plays ball. The committee will get two rounds of PMI prints, as well as reports on GDP, inflation and the labour market before the next meeting; today’s dovish hold likely reflects a desire to get confirmation that inflation is falling after its recent downside surprise. Should we get a disinflationary budget in line with expectations, a December rate cut seems on the cards.”

George Brown, senior economist, Schroders
"Holding rates today was the right decision, with inflation still nearly double the 2 per cent target. The bank will be in a stronger position after the dust settles from the Budget, armed with additional jobs and inflation data, to judge whether further easing is warranted in December. A cautious approach remains appropriate given the risk that high inflation becomes entrenched, due to sticky wage growth and subdued productivity. However, this may change if reports that the Chancellor intends to double her fiscal headroom to £20 billion ($26 billion), through fiscal tightening in the region of £40 billion, are true. Alongside mooted tax cuts on household energy bills, if these measures materialise, they could create scope for the Bank to cut multiple times next year."

Neil Birrell, CIO at Premier Miton Investors
“Given the Budget uncertainty that is overhanging, it would have been a shock if there was a cut in interest rates today. As inflation and jobs data will be released between now and the December meeting, by which time we will have had the Budget, it is unsurprising to see the Bank take a gradual approach to policy change. However, the economy could do with a boost and there isn’t much else providing that at present. A cut in mid-December might actually be needed to support consumers and businesses – it is a critical period for the UK economy.”

Ed Monk, pensions and investment specialist, Fidelity International
“Though no cut to rates arrived, it’s clear the consensus is shifting inside the Bank of England. Four MPC members voted for a cut and, just as significantly, minutes from the meeting suggest members believe that inflation has now peaked. Ahead of the decision, money markets have been altering their expectations for rates downwards, with two more quarter-point cuts now expected by the spring of next year. One more cut is now expected over the next six months than was the case a few weeks ago.

“Inflation sticking below the Bank’s forecast of 4 per cent has relieved some of the pressure on the MPC to keep rates higher and it should now feel more able to lower borrowing costs. That’s a boost to indebted households and the mortgage market but would also help the Government in its efforts to kickstart growth. For investors, cash rates still appear attractive with returns from savings accounts and cash funds still staying ahead of inflation. Cash and money market funds accounted for four of the top ten best-selling funds for Fidelity Personal Investing clients in October, indicating that many are happy to sit on the sidelines and milk risk-free returns from now.”

James Lynch, investment manager at Aegon AM
“Those favouring a cut cited continued disinflation and faster-than-expected labour market loosening. In contrast, the hold camp emphasised persistent inflation and concerns over second-round effects and inflation expectations. Bailey described it as a close call, signalling that he wants more evidence of durable disinflation before supporting a cut. Markets now see a high probability of a cut at the next meeting on 18 December, pricing in 17 basis points – just shy of a full 25 bps move.”

Jamie Niven, senior fixed income fund manager at Candriam
“Looking forward, Bailey has left the door open to a December cut (despite it not being a forecast meeting) especially with the outcome of the Budget feeding further information into the equation by that point. The phraseology that the “Bank rate is likely to continue on a gradual downward path” suggests that multiple more cuts are likely and therefore that risks to terminal rates are likely to the downside. We retain a positive view on UK rates, especially on a relative basis.”

Esther Watt, bond strategist at Evelyn Partners
“Although widely anticipated and priced in, the vote saw a five to four split in the monetary policy committee with Taylor, Dhingra, Ramsden and Taylor all voting for a 25 bp cut to 3.75 per cent. This is more dovish than the six to three expected and reflects some recent soft data on the real economy, a lowering of inflation expectations, and some slack in the labour market. Some MPC members will be deferring judgment until they see the contents of the Chancellor of the Exchequer’s highly-anticipated Autumn Budget. The Bank lowered its GDP forecast for Q4 2025 and Q4 2026 to 1.4 per cent (from 1.5 per cent and 1.3 per cent) while increasing Q4 2027 to 1.7 per cent (from 1.6 per cent). It lowered CPI forecasts for Q4 2025 to 3.5 per cent (from 3.6 per cent) while keeping Q4 2026 and Q4 2027 at 2.5 per cent and 2 per cent respectively. Unemployment is expected to be marginally higher over all periods – at 5 per cent (from 4.9 per cent) for Q4 2025 and Q4 2026 and 4.9 per cent (from 4.8 per cent) in Q4 2027. While this meeting will be taken as a dovish hold, markets are little moved.”

John Wyn-Evans, head of market analysis at Rathbones
“Market reaction was muted. In terms of interest rate expectations, futures prices still imply a further pause in December (63 per cent probability of a cut), with the next reduction coming in February. The relatively dovish vote and tone of commentary provided a small boost to both equities and gilts, but nothing really meaningful. This event was always going to play second fiddle to the Budget on 26 November. The outcome of that and its impact on the growth and inflation outlook will play a large part in the next rates decision meeting on 12 December.”

Brad Holland, director of investment strategy at JP Morgan Personal Investing 
“Sticky inflation and elevated wage growth in the UK labour market continues to be front of mind for policymakers as the outlook for the economy remains uncertain. Looking ahead, two events are set to shape whether a fourth and final rate cut this year will be possible at the next meeting. The next set of inflation figures on 19 November will show if further progress has been made to bring down price increases, in particular services inflation. Following hot on the heels will be the Budget, and a chance to see if the Chancellor’s policy decisions are inflationary or can meaningfully lower the cost-of-living for UK households. For investors, mortgage holders, and borrowers hoping for relief from the Bank, the question remains: if not now, when?”