CBI responds to latest interest rate decision - September 2025

Alpesh Paleja, Deputy Chief Economist, CBI said: 

“Today’s decision to hold interest rates came as no surprise. The bigger question is how the Monetary Policy Committee will move in the months ahead. While there is broad agreement that rates should fall further, opinions differ on how quickly and by how much.

“Further cuts are supported by a weakening jobs market and signs of slower wage growth. But the MPC remains wary of stubborn price pressures. The risk is that the expected inflation “hump” this Autumn feeds into wages and price setting, at a time when households’ inflation expectations are rising.

“In the run-up to their November meeting, the Committee will be watching data closely for these signals. They will also keep a close eye on bond market stability after recent volatility, which likely played into today’s decision to slow the pace of “quantitative tightening.”