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Week of 21 September 2026
The Bank of England holds at 3.75%, inflation ticks up to 3.1%, and two months in, what the buy-now-pay-later rules cover. Plus a Bank Rate chart since 2020 and this week's interview question.
By Kinza 3 min read Facts checked 29 Sept 2026 How I check
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The Bank of England kept interest rates at 3.75%
Last Thursday, 17 September, the Bank of England held at 3.75%, where it has been since 18 December 2025. The next decision is on 5 November. The Bank says that when Bank Rate moves, banks usually change what they charge on loans and pay on savings. But the rates people actually get are set by the banks: in July, money in sight deposits (accounts you can take everything out of at any time) earned 1.65% on average, while new time deposits (accounts where you can't take all your money out without a penalty) paid 4.21%.
What it means
Bank Rate
The UK's main interest rate, set by the Bank of England. Interest is the fee for borrowing money, or the reward for saving it. When Bank Rate goes up, banks usually charge more for loans and pay more on savings, so people spend less and prices rise more slowly.
Source: Bank of England3.75%
Bank Rate
Sources
- Bank of England · Bank Rate, the latest decision and the date of the next one
- Bank of England · Official Bank Rate history, including the cut to 3.75% on 18 December 2025
- Bank of England · Effective interest rates, July 2026: sight deposits 1.65%, new time deposits 4.21%
- Bank of England · Further details about effective interest rates data: what counts as a sight deposit and a time deposit
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UK inflation rose to 3.1%
Figures published last Wednesday, 16 September, show inflation was 3.1% in August: prices were 3.1% higher than a year earlier, up from 2.9% in July and still above the Bank of England's . At that rate, a £10 lunch would cost about £10.31 a year later.
What it means
CPI
Short for Consumer Prices Index. Every month, the Office for National Statistics (ONS) checks the prices of about 700 everyday items, like a giant shopping basket, and compares them with a year earlier. The result is CPI, the inflation rate the Bank of England tries to keep at 2%.
Source: Bank of EnglandWhat it means
Inflation target
The rate of inflation the government has told the Bank of England to aim for: 2% a year, measured by CPI. It is 2% rather than 0% because if prices start falling, people may put off spending, and that can lead to businesses closing and people losing jobs.
Source: Bank of England3.1%
CPI inflation, August 2026
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Two months in: what the buy-now-pay-later rules cover
Since 15 July 2026, the regulates deals where the lender is a different business from the shop. Before you agree, the lender must check you can afford to repay and tell you when each payment is due, how much it is, and how much any late fee will be. If you miss a payment, the lender must contact you and explain what it means, and you can complain to the . Two things are not covered: deals taken out before 15 July, and deals where the shop lends you the money itself.
What it means
FCA
Short for Financial Conduct Authority: the UK's watchdog for financial firms such as banks and lenders. It sets the standards they must meet and holds them to account if they don't.
Source: Financial Conduct AuthorityWhat it means
Buy now, pay later
A way to split the cost of something into smaller payments over time, without paying interest. Since 15 July 2026 the FCA, the UK's financial watchdog, regulates it when the lender is a different business from the shop.
Source: Financial Conduct AuthorityWhat it means
Financial Ombudsman Service
A free service, set up by Parliament, that settles complaints between people and financial businesses such as banks, lenders and insurers. Think of it as a referee.
Source: Financial Ombudsman Service15 Jul
Rules in force
Chart of the week
Bank Rate since 2020: from 0.1% to 5.25% and back down to 3.75%
Every change to Bank Rate since the start of 2020, spaced by date, up to the latest hold on 17 September 2026. It was cut to 0.1% in March 2020, raised fourteen times in a row from December 2021 to August 2023, then cut six times from August 2024 to December 2025.
View the data Hide the data
| Date | Value |
|---|---|
| 1 Jan 2020 | 0.75% |
| 11 Mar 2020 | 0.25% |
| 19 Mar 2020 | 0.1% |
| 16 Dec 2021 | 0.25% |
| 3 Feb 2022 | 0.5% |
| 17 Mar 2022 | 0.75% |
| 5 May 2022 | 1% |
| 16 Jun 2022 | 1.25% |
| 4 Aug 2022 | 1.75% |
| 22 Sep 2022 | 2.25% |
| 3 Nov 2022 | 3% |
| 15 Dec 2022 | 3.5% |
| 2 Feb 2023 | 4% |
| 23 Mar 2023 | 4.25% |
| 11 May 2023 | 4.5% |
| 22 Jun 2023 | 5% |
| 3 Aug 2023 | 5.25% |
| 1 Aug 2024 | 5% |
| 7 Nov 2024 | 4.75% |
| 6 Feb 2025 | 4.5% |
| 8 May 2025 | 4.25% |
| 7 Aug 2025 | 4% |
| 18 Dec 2025 | 3.75% |
| 17 Sep 2026 (held) | 3.75% |