The Bank of England building, on the day of the Monetary Policy Report press conference, in London, Britain, November 6, 2025. REUTERS/Maja Smiejkowska

LONDON (Reuters) -The Bank of England kept borrowing costs on hold on Thursday, but the narrow vote signals a rate cut could come in December, when they hold their next meeting after the government budget later this month.

Mindful of Britain's still high headline inflation rate, the nine-strong Monetary Policy Committee voted 5-4 to keep the central bank's benchmark Bank Rate at 4.0%, the BoE said.

Here's what Bank of England officials said in a press conference following that decision:

ANDREW BAILEY, GOVERNOR

On the future path of rates

"We are likely to continue to be on a gradual downward path for bank rate."

"The market curve at the moment, does give a reasonable view of, I think, of a sensible path (for rates)."

On inflation

"We need to wait and see that the downward path of inflation becomes more established before we can cut bank rate again."

"The recent pickup in inflation has been driven in part by food and energy prices. These are salient to consumers and often affect inflation expectations, so we have to remain careful that this does not lead to any additional second round effects on wage and price setting in the UK economy."

"The point is that we are, you know, we are quite an important moment here, because we've had one set of inflation numbers, which I think can give us some encouragement, can point us in a direction, but we need to see more than that."

On terminal rate

"There are those, and I'm in this group, who don't actually, frankly, feel that there is enough confidence around any measure of an equilibrium terminal rate, and that when we look at this question of restrictiveness, we're looking much more at the at the evidence on the sort of the change over time, as it were, in the path of restrictiveness, rather than looking at terminal rates."

On asset purchase costs

"(The) upcoming APF Quarterly Report will include a new measure which will take into account wider implications for government debt issuance and servicing costs, including continuing savings resulting from quantitative easing...This will show a somewhat different picture of the costs."

On AI

"It is, of course, perfectly possible and perfectly consistent that AI could be the next big mover in terms of productivity ... My own view personally is, I think, more likely than not it probably is.

"But we've still got quite a way to go to actually sort of see that demonstrated. At the same time, we could have a bubble, because obviously the markets are pricing the future stream of returns from this, and that's uncertain. And so, you know, those two things are not inconsistent."

"The markets could overprice the returns, but the returns could still be substantial...So we'll see, but we are watching the ... implications for financial stability."

DAVE RAMSDEN, DEPUTY GOVERNOR

On AI

"Were that (AI) bubble to deflate or burst, that would represent a tightening in financial conditions that would weaken global demand, and that would have spillovers back to the UK."

(Reporting by UK Bureau; Editing by Kate Holton)