The Bank of England has voted to keep the base rate at 3.75% at its February 2026 meeting , a decision that had been expected, but only narrowly passed. The vote split five to four in favour of a hold, with four members calling for a further 0.25% reduction to 3.50%.
The decision follows a cut in December and comes amid renewed inflationary pressure, with CPI rising slightly to 3.4% in the year to December. Despite this, several Committee members expect inflation to return closer to the 2% target from April.
Lenders began the year by trimming mortgage pricing, but recent days have seen a modest reversal. Some fixed rates have edged up again, reflecting movements in swap markets and a more cautious view on the pace of further cuts.
Commenting on the decision, David Wise, Founder of Fitch & Fitch noted:
“It always looked unlikely that the Bank would cut again this month, but the close vote was telling. Four members voted in favour of a further reduction, suggesting there’s still downward pressure in the system.”
“The hold will be disappointing for those on variable or tracker mortgages, who would have seen monthly costs fall again. And those refinancing will have noted that some lenders have recently increased fixed rates, driven by an uptick in swap rates and a shift in market expectations.”
“There’s still value in acting early. With lenders repricing frequently, booking a product in advance provides peace of mind. If rates fall further, you can usually move to a lower deal before completion. If they rise, you’ve locked in at a favourable level.”
Strategic positioning in an uncertain market
For clients looking to remortgage or purchase this spring or summer, securing a rate early remains prudent. The cost of borrowing may ease further but as seen this week, sentiment can shift quickly.
Working with a whole-of-market adviser such as Fitch & Fitch ensures access to the full lending landscape and the flexibility to adjust as markets move.