Bank of England leaves interest rates on hold with committee split 8-1; ECB also keeps rates steady – as it happened
The Bank of England has left interest rates unchanged at 3.75%.The central bank’s rate-setting monetary policy committee (MPC) voted to leave borrowing costs on hold at noon, after its latest meeting.The vote by the nine-member committee to keep rates on hold was split eight to one. The Bank’s chief economist Huw Pill voted for a rate hike to 4%
Could the UAE’s shock exit from Opec cause an oil price war?
The conflict in the Middle East has claimed Opec as the latest casualty of war. The United Arab Emirates’ shock exit from the oil cartel on Tuesday after 60 years is expected to weaken the alliance, which under the leadership of Saudi Arabia has helped to soothe volatility in the global oil market for decades.Global oil prices reached the highest level in four years on Thursday, rising above $126 a barrel. But as the region grapples with the continuing conflict, a fresh war may be brewing in the international oil markets, which could lead to greater market volatility for years to come.For now, the UAE’s intention to ignore Opec production quotas and pump as much crude as it wants is notional, owing to Iran’s blockade on the strait of Hormuz
Oil price tops $126 a barrel after Trump warns Iran blockade could last ‘months’
The global oil price hit $126 a barrel on Thursday, its highest level since 2022, after Donald Trump said the US blockade of Iranian ports could last for months and peace talks remained stalled.After surging more than 13% in 24 hours, the price of Brent crude futures reached its highest price since the war began on 28 February. Not since Russia’s 2022 invasion of Ukraine has Brent topped $120, with the price then peaking at $139.Oil markets have been spooked this week as Trump appeared willing to maintain the US navy’s blockade of Iranian ports, with Iran responding by keeping the strait of Hormuz all but shut to other oil tankers.Market observers believe that traders are beginning to look beyond the early optimism that a diplomatic resolution could restore Gulf oil flows through the vital trade route, and towards “the reality of the supply situation”
US economic growth rebounds 2% as consumer spending slows amid Iran war
US gross domestic product (GDP) accelerated to an annual rate of 2% in the first three months of 2026, though consumer spending is slowing as the war with Iran continues to impact energy prices.The last GDP reading for the fourth quarter of 2025 showed that US economic growth slowed to an annual pace of 0.5%, largely due to a contraction in government spending after massive layoffs of federal workers last year. The federal government is down 355,000 workers, or 11.8% of the workforce, since October 2024, according to the Bureau of Labor Statistics
Eurozone inflation soars to 3% as Iran war drives up energy prices
Inflation across the eurozone soared to 3% this month as the Iran war drove up energy prices and growth stumbled.Consumer prices rose by 3% in the year to April across the single currency bloc, data from the statistics body Eurostat showed on Thursday morning, up from 2.6% in March and 1.9% in February.That took inflation further above the 2% target set by the European Central Bank, which left interest rates across the eurozone on hold on Thursday afternoon
Why Bank kept interest rates on hold despite message for UK to brace itself for Trumpflation
The message to the UK’s crisis-weary households from the Bank of England is: brace yourself for Trumpflation – and the higher interest rates it may yet take to rein it in.Reading the Bank’s quarterly monetary policy report, it is not difficult to understand the fury Rachel Reeves expressed while in Washington this month at the “folly” of the US president’s war on Iran – its economic consequences will hit the UK hard.As a result of the conflict and the resulting rise in oil and gas prices, the Bank reckons average mortgage repayments are to rise by £80 a month; food price inflation could hit 4.6% by the autumn; and utility bills will jump in July and remain high into the winter.Overall inflation is now expected to peak above 3
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