On Thursday 19 June, the BoE held interest rates at 4.25% after reducing the figure by 0.25% last month in a bid to reach the Government’s 2% inflationary target.
At its meeting ending on Wednesday 18 June 2025, the Monetary Policy Committee (MPC) voted by a majority of 6–3 to maintain the rate while three members preferred to reduce it by 0.25 percentage points, to 4%.
It said continued global uncertainty, high energy prices, weak GDP and the loosening of the labour market were behind the move.
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UKHospitality (UKH) chief executive Kate Nicholls said the measures announced in last year’s Budget were keeping interest rates “higher for longer”.
She continued: “With hospitality businesses having just been hit with £3.4bn in additional annual cost and many still grappling with Covid-related debt, it will be frustrating for many that there hasn’t been a cut today.
“Tackling the cost of doing business is critical, so we need the bank to cut interest rates at its next meeting and for the Government to take action to fix NICs and implement the maximum possible discount for hospitality businesses as part of business rates reform.”
‘Stagflation’
Earlier this week, the trade body warned the economy was at risk of “stagflation” after the headline rate of inflation held steady at 3.4% in May while food prices continued to soar, according to figures from the Office for National Statistics (ONS).
The official data showed food prices made some of the largest upward contributions to the rate, rising 4.4% during the 12-month period, and partially offsetting downward contributions from other divisions such as transport.
Commenting on the inflation statistics, Nicholls said: “This is detrimental to the entire economy and consumer confidence, so the Government needs to support businesses, particularly those in the hospitality sector, which has proved time and time again it can drive growth under the right circumstances.”
The MPC will next meet on Wednesday 6 August.
