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The Bank of England (BoE) on Thursday announced its decision to maintain the key lending rate at the existing level, remaining committed to "squeezing out any existing or emerging persistent inflationary pressures". The central bank targets to contain inflation sustainably at 2 per cent over the medium term.

The British central bank's rate-deciding panel voted 7:2 in favour of a status quo on benchmark rates. Two members voted to reduce the rate by 25 basis points (bps) to 3.75 per cent. 

Inflation in the UK economy was last recorded at 3.8 per cent (August). 

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The latest rate decision comes a day after the Federal Reserve -- the American central bank -- announced a 25-basis-point cut in the benchmark interest rate known as the funds range.

ALSO READ: Fed Rate Decision: Jerome Powell announces 25-basis-point rate cut as widely expected

Major central banks are focused on achieving sustainable growth with moderate inflation levels while ensuring optimum employment. 

The UK's benchmark interest rate -- known as the bank rate -- stands at 4.0 per cent.

Its next rate decision is due on November 6. 

ALSO READ: Japan's Q2 GDP growth revised up to 2.2% as consumer spending boosts growth

The central bank acknowledged that substantial disinflation over the past two and a half years enabled it to cut rates over the past year.

The BoE's rate-deciding panel noted subdued underlying UK GDP growth, "consistent with a continued, gradual loosening in the labour market, as well as a margin of slack in the economy".

It also mentioned persistent "downside domestic and geopolitical risks around economic activity".

For the April-June period, UK GDP growth was recorded at 0.3 per cent sequentially, better than most expectations, with household consumption expanding 0.1 per cent but business investment falling 4.0 per cent. 

The BoE expects the UK's headline GDP to grow around 0.4 per cent in Q3, which is "slightly stronger than the underlying trend". 

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