Bank of England keep interest rate at 3.75%

Bank of England keep interest rate at 3.75%

05 Feb 2026

Simeon Willis, Chief Investment Officer, XPS Group, commented: "The Bank’s decision to hold rates was firmly in line with market expectations and is unlikely, in itself, to have a material impact on pension scheme investors. The more important story for schemes remains the longer-term direction of travel, rather than today’s pause. Whilst December’s CPI rose to 3.4% from 3.2%, this had in part been anticipated already due to Tobacco duty and rising airfares. That said, longer-term inflation expectations implied by the gilts market edged slightly higher over January. For defined benefit schemes, this is relevant, as even modest increases in long-dated inflation expectations can feed through into liability values, where they are linked to inflation."