The Monetary Policy Committee (MPC) has voted to hold the Bank of England base rate at 4%, maintaining its cautious stance as it continues to monitor inflationary pressures. Seven members voted in favour of holding, while two voted for a reduction to 3.75%.
In its statement, the Committee confirmed 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.” CPI inflation stood at 3.8% in August and is expected to rise slightly in September before easing towards target.
David Wise, Founder of Fitch & Fitch, commented:
“There was always a slim chance of a cut, but with inflation still almost double the Bank’s target, the MPC has erred on the side of caution.
Encouragingly, two members voted for a reduction—perhaps a signal that sentiment is beginning to shift. However, with inflation expected to tick back above 4% at the next reading, November may prove too early for a meaningful move downwards.”
Uncertainty remains around how fiscal policy may influence housing sentiment. With speculation building ahead of the Chancellor’s Autumn Statement, including potential changes to property taxation, many discretionary buyers and sellers are opting to wait.
“A rate cut would have sent a strong signal to the housing market—particularly as affordability remains a challenge, despite five rate reductions since last summer,” David noted. “It’s encouraging to see some movement within the Committee, but momentum is still slow.”
What this means for borrowers
For clients considering a new mortgage or refinancing, the current environment underscores the importance of preparation. Rates can often be secured up to six months in advance, offering certainty in uncertain times.
Independent brokers such as Fitch & Fitch remain well-placed to secure competitive options, particularly where timing or complexity are factors. Should market rates fall ahead of completion, many lenders will allow borrowers to switch to a lower product before drawdown.
As always, the key is to plan early, understand your option, and work with advisers who can help you read between the lines – contact our highly experienced team today 0207 859 4098