Bank of England holds base rate at 5.25% again – here's what it means for your mortgage and savings

The Bank of England has today held its base rate at 5.25% for the third time in a row. This rate is used by the central bank to charge other banks and lenders when they borrow money – and so it influences what borrowers pay and what savers earn.

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Bank of England holds base rate at 5.25% again – here's what it means for your mortgage and savings

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  • Vote was 6 to three to hold. No votes to cut rate. 

    Bank of England pushes back against rate cut speculation | Reuters

    "The Bank of England stuck to its guns on Thursday and said British interest rates needed to stay high for "an extended period", a day after the U.S. Federal Reserve signalled it would cut U.S. interest rates in 2024.

    The Monetary Policy Committee voted 6-3 to keep rates at a 15-year high of 5.25% and Governor Andrew Bailey said there was "still some way to go" in the fight against inflation, challenging investors who have bet increasingly on rate cuts.

    The three dissenting votes were in favour of raising borrowing costs and there was no talk of cutting them as the BoE remained concerned that inflation in Britain will prove stickier than in the United States and the euro zone."
  • Three votes to raise is surprising imo
  • mebu60
    mebu60 Posts: 799
    First Post First Anniversary Name Dropper
    Three votes to raise is surprising imo
    Given all the talk is about expected cuts next year I would have expected some analysis of why a third of the BoE MPC voted to increase them again now. And no-one voted for a reduction. 
  • Hoenir
    Hoenir Posts: 1,178
    First Post Name Dropper
    The BOE meeting minutes do subsequently get released.  At the macro level there's a complex picture to comprehend. From now on it will be fine tuning as events unfold. As has been said on many occasions takes 18 months for a rate rise to reach the real economy and have a full impact. Meanwhile QT will quietly ensure lending rates at elevated levels. 
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