Bank of England Holds Base Rate at 3.75% Amid Rising Inflation and Energy Prices
The Bank of England has maintained its base rate at 3.75% for the sixth consecutive time, sparking predictions that several rate rises could be in the pipeline.
The decision was made by the Monetary Policy Committee (MPC), which voted six to three to hold the rate. Three members had voted to increase it by 0.25 percentage points, to 4%. The MPC cited rising inflation and energy prices as reasons for holding back on a rate hike.
Despite the decision not to raise rates, experts warn that homeowners should not expect mortgage rates to fall immediately. 'The key message is not to assume that a hold today automatically translates into cheaper borrowing tomorrow,' said Ian Futcher, financial planner at Quilter.
Instead, savers and borrowers are advised to review their options early, as the hold on interest rates does not necessarily mean cheap deals will arrive soon. Meanwhile, millions of people on standard variable rates (SVRs) can save '£1,000s' by switching to a new mortgage deal.