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UK policy rate and inflation: how close the two figures now sit

The Bank of England's policy rate stayed at 3.75% from June to September 2026, while consumer price inflation rose each month, from 2.6% to 3.5%.

Published 2 min read

  • 2026-063.75%
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  • 2026-083.75%
  • 2026-093.75%
United Kingdom central bank policy rate (month-end) · Bank of England

UK Central bank policy rate →

What has changed for households?

For an ordinary household, prices are rising faster than they were at the start of the summer. The policy rate set by the Bank of England has not moved over the same months.

Sources for this paragraph (4)

The policy rate stood at 3.75% at the end of each month from June to September 2026. Over the same months, consumer price inflation went up every month.

Sources for this paragraph (8)

What do the official figures show?

Consumer price inflation is measured as a 12-month change. It was 2.6% in June 2026, 2.9% in July, 3.1% in August and 3.5% in September.

Sources for this paragraph (4)

The policy rate is recorded at month-end. It was 3.75% in June, July, August and September 2026.

Sources for this paragraph (4)
  • F1 United Kingdom central bank policy rate (month-end) · 3.75% · 2026-06 · Bank of England
  • F2 United Kingdom central bank policy rate (month-end) · 3.75% · 2026-07 · Bank of England
  • F3 United Kingdom central bank policy rate (month-end) · 3.75% · 2026-08 · Bank of England
  • F4 United Kingdom central bank policy rate (month-end) · 3.75% · 2026-09 · Bank of England

A broader measure, CPIH, includes the housing costs of people who own their homes. It showed a 12-month change of 3.6% in September 2026. CPIH is calculated differently from the main consumer price measure, so the two figures are not interchangeable.

Sources for this paragraph (2)

How does the rate compare with inflation now and in June?

In June 2026 the policy rate of 3.75% sat well above inflation of 2.6%. By September the rate was still 3.75%, and inflation had reached 3.5%. The rate remained above inflation, but the gap between the two was much narrower than in June.

Sources for this paragraph (4)

The narrowing came entirely from inflation rising. The rate itself did not change in any of the four months.

Sources for this paragraph (8)

What does this mean for people living in the UK?

The goods and services tracked by the main price measure cost 3.5% more in September 2026 than a year earlier. Three months before, that figure was 2.6%.

Sources for this paragraph (2)

Food prices showed a 12-month rise of 1.3% in September 2026. The figures do not show how much each type of spending contributed to overall inflation.

Sources for this paragraph (1)

Average weekly earnings grew by 3.7% over 12 months, measured as a 3-month average to August 2026. This uses a different method and period from the monthly price figures, so it cannot be set directly against them.

Sources for this paragraph (1)

The seasonally adjusted unemployment rate was 4.7% in July 2026. One reading on its own does not show a trend.

Sources for this paragraph (1)

What can the data not tell us?

The figures show what happened to the rate and to prices. They do not explain why inflation rose or why the rate was held.

Sources for this paragraph (4)

The latest inflation reading is for September 2026, and the earnings figure stops at August. The data does not show what happens to mortgage rates or loan costs for individual households.

Sources for this paragraph (2)

Scenarios to watch

  • Scenario, not a forecast If inflation keeps rising in the coming months while the policy rate stays at 3.75%, the gap between the two would keep narrowing and could close.
  • Scenario, not a forecast If inflation falls back towards its June level, the policy rate would again sit clearly above the pace of price rises.
  • Scenario, not a forecast If the Bank of England changes the policy rate, the comparison with inflation would shift from both sides at once.

What to check next

  • The October 2026 consumer price inflation figure and whether it is above or below 3.5%
  • The month-end policy rate for October 2026
  • The next CPIH reading and how it compares with its September figure of 3.6%
  • The next average weekly earnings release covering September 2026
  • The next seasonally adjusted unemployment rate

Verified data used in this report

IndicatorValuePeriodSourcesAccessed
F1United Kingdom central bank policy rate (month-end)3.75%2026-06Bank of England
F2United Kingdom central bank policy rate (month-end)3.75%2026-07Bank of England
F3United Kingdom central bank policy rate (month-end)3.75%2026-08Bank of England
F4United Kingdom central bank policy rate (month-end)3.75%2026-09Bank of England
F5United Kingdom consumer price inflation (12-month change)2.6%2026-06Office for National Statistics (UK)
F6United Kingdom consumer price inflation (12-month change)2.9%2026-07Office for National Statistics (UK)
F7United Kingdom consumer price inflation (12-month change)3.1%2026-08Office for National Statistics (UK)
F8United Kingdom consumer price inflation (12-month change)3.5%2026-09Office for National Statistics (UK)
C23United Kingdom GDP growth (annual %)1.39%2025World Bank
C24United Kingdom Unemployment, total (% of labour force, ILO modelled estimate)4.75%2025World Bank
C25United Kingdom Fertility rate, total (births per woman)1.552024World Bank
C26United Kingdom Population aged 65 and above (% of total population)19.7%2025World Bank
C27United Kingdom Population growth (annual %)0.3%2025World Bank
C30United Kingdom CPIH inflation, including owner occupiers' housing costs (12-month change)3.6%2026-09Office for National Statistics (UK)
C31United Kingdom food price inflation (12-month change)1.3%2026-09Office for National Statistics (UK)
C32United Kingdom unemployment rate (seasonally adjusted)4.7%2026-07Office for National Statistics (UK)
C33United Kingdom average weekly earnings growth (3-month average, 12-month change)3.7%2026-08Office for National Statistics (UK)

Sources

  • Source: Bank of England, licensed under the Open Government Licence v3.0 — license
  • Source: Office for National Statistics, licensed under the Open Government Licence v3.0 — license
  • Source: World Bank, World Development Indicators (CC BY 4.0) — license

How this report was checked

  • Data: the newest reference period cited is 2026-09.
  • Figures were collected from the source on
  • Written by an AI model (claude-opus-5-5) using only the official figures listed in this report.
  • Automatic checks passed: every number matches a cited figure, every paragraph names its evidence, and there is no investment advice or copied source text.
  • A separate quality-check model raised concerns, and the report was rewritten once to address them.
  • No person reviewed this report before publication. Automatic checks confirm the numbers, not every interpretation.
Update history
  • 2026-10-28 12:00 UTC — created
  • 2026-10-28 12:00 UTC — approved+published

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