Bank of England Holds Interest Rates at 4% | What It Means for Buyers & Homeowners

Bank of England Holds Rates at 4%

The Bank of England (BoE) has voted to hold the base rate at 4%, a move widely expected by financial markets.

This decision follows yesterday’s inflation figures, which showed the rate of price rises holding steady at 3.8% – still well above the Bank’s target of 2%.

In a statement, the Monetary Policy Committee said it “remains focused on squeezing out any existing or emerging persistent inflationary pressures, to return inflation sustainably to its 2% target in the medium term.”

In other words, they’re keeping rates steady for now in the hope that inflation will continue to cool in the coming months.

Could Rates Fall Further?

Experts believe we could see gradual rate cuts over the next few months, although no one is expecting dramatic moves.

Deutsche Bank predicts a possible cut in December, while others are waiting to see how the upcoming Budget (announced 26 November) will impact the economy before making firm forecasts.

What Does This Mean for Borrowers?

The good news is that mortgage rates are continuing to edge downwards. According to Moneyfacts, the average two-year fixed rate has fallen from 5.2% four months ago to under 5%. For context, this figure was 6.85% back in August 2023.

This drop could save borrowers thousands of pounds a year compared to what they would have paid two years ago.

However, experts warn that rates aren’t likely to tumble further any time soon – so if you’ve been delaying a purchase or remortgage waiting for the “perfect” moment, it might be better to move forward rather than wait.

What’s Next?

The BoE meets again on 6 November to discuss the next rate decision, with Chancellor Rachel Reeves’ Budget following later in the month.

If you’d like personalised advice about how today’s decision could affect your next move, whether that’s buying, selling, or remortgaging, get in touch with our team today.

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