The Bank of England kept its policy interest rate constant at 4.5% on Thursday, in line with market expectations.
There has been substantial progress on disinflation over the last two years, as previous external shocks have receded, the bank said.
“And as the restrictive stance of monetary policy has curbed second-round effects and stabilised longer-term inflation expectation,” it said.
It said inflation rose to 3% in the UK in January, up from 2.5% in December 2024.
Mentioning the implementation of new US tariffs on imports, the bank said global trade policy uncertainty has intensified, and the US has made a range of tariff announcements, to which some governments have responded.