Interest rates ‘on path down’ despite hold at 5%, Bank of England chief says

Threadneedle Street has cautioned against expecting rapid reductions in borrowing costs, forecasting inflation was on track to rise later this year. Photograph: Alberto Pezzali/AP

The governor of the Bank of England has signalled readiness to resume interest rate cuts despite keeping borrowing costs unchanged on Thursday at 5%, amid concerns over lingering high inflation.

Andrew Bailey said the central bank was “now gradually on the path down” from borrowing costs that were among the highest since before the 2008 financial crisis. “I think interest rates are going to come down, I’m optimistic on that front,” he said.