BoE Holds Base Rate at 3.75% Amid Inflation Easing Expectations

The Bank of England has held its base rate at 3.75% for the fifth time, following a decision that was not unanimous. Six members of the Monetary Policy Committee voted to keep the base rate unchanged, while three voted to increase it to 4%. The decision was expected but marks the fourth consecutive hold since December 2025.

The current inflation rate is at 2.8%, slightly above the Bank's target of 2%. However, with a potential ceasefire in the Middle East and the reopening of the Strait of Hormuz on the horizon, markets expect inflation to ease over the rest of the year.

For homeowners with variable-rate or tracker mortgages, today's decision means no change to their monthly payments. Those with fixed-rate mortgages will see their repayments unaffected by this decision, but may face higher rates when they expire.