Bank of England keeps rates unchanged, pauses lengthy hiking cycle

Investing.com -- The Bank of England kept interest rates on hold on Thursday, keeping its base rate at 5.25%, halting a run of 14th consecutive increases since December 2021.

This decision had been seen as finely balanced, as data earlier in the week had showed a surprise drop in U.K. inflation in August, although it remained considerably above the bank's 2% medium-term target.

The U.K. headline consumer price index sank to an 18-month low of 6.7% in August, while core inflation, which excludes volatile food and energy prices, fell sharply to 6.2% from 6.9% in July.

Britain's inflation rate has fallen from a peak above 11% last October but even after the latest drop it remained among the highest in the industrialized world.

At 07:05 ET (11:05 GMT), GBP/USD fell 0.7% to 1.2259, with sterling falling to its weakest level versus the U.S. dollar since early March.

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