What the numbers said this week

The policy setting

The Bank of England is holding Bank Rate at 3.75 per cent. That is the fifth consecutive hold since the last cut in December 2025, and the lowest setting since February 2023. The next scheduled decision is 17 September. Markets have spent the summer arguing with themselves about whether the next move is up or down. Economists are split in the same way, which is another way of saying nobody is confident.

Consumer price inflation was 2.9 per cent in the year to July, up from 2.6 per cent the month before. That is still above the 2 per cent target. It is also not the 10 per cent world of 2022. The awkward fact is the direction: the Bank’s own July report expected inflation to rise later this year as earlier energy increases continue to pass through. A hold is not the same as a declaration of victory.

The July vote still matters

In July the Monetary Policy Committee voted 6–3 to hold, with three members preferring an immediate rise to 4 per cent. That split is the story. The majority is leaning on a looser labour market, still-elevated borrowing costs, and the absence so far of a clear second-round wage response. The minority is looking at energy, import prices and the risk that households start to expect 3 per cent to become a habit.

The fiscal calendar

Westminster is walking toward a late-October Budget with less room than the rhetoric implies. Public sector net financial liabilities were 83.7 per cent of GDP at the end of July. Debt interest in 2025–26 ran at about £110 billion — the third-largest item of public spending after health and welfare. Gilt investors have spent 2026 repricing UK duration whenever growth, oil or politics twitched. That is the constraint the Chancellor actually faces, whatever the fiscal rules say on paper.

What we are watching until 17 September

• Services inflation and private-sector pay settlements, still the cleanest read on domestically generated pressure.
• Vacancies and the unemployment rate, which Bank staff had expected to drift toward 5.1 per cent in the second quarter.
• Oil and wholesale gas, because the energy shock is the thing the MPC keeps saying it wants to look through.
• The 10-year gilt, which has spent the year in a 4.3 to 4.7 per cent neighbourhood whenever issuance nerves return.

If you only read one longer essay this week, read the monetary note. If you read two, add the fiscal one. Housing and inactivity are the slow-moving stories that will still be here in 2027.