After the announcement of the UK benchmark interest rate decision, the pound extended its decline.

The Bank of England decided to keep interest rates unchanged at 3.75% with a vote of 7-2 and signaled caution towards tightening policy, leading to a further drop in the pound. Bank of England Governor Andrew Bailey stated that attempting to quickly bring inflation back to the 2% target could cause unnecessary fluctuations in output. He said that given the weakness in the real economy, as well as uncertainty surrounding the scale and duration of energy price shocks, it seems appropriate to tolerate temporarily higher inflation rates. However, there were still two policymakers who supported a rate hike. Following the announcement, the pound fell to a 10-week low against the US dollar, dropping from 1.3223 to 1.3208. The euro rose to a three-week high against the pound, increasing from 0.8663 to 0.8673.