Following the most recent Monetary Policy Committee announcement on September 21, the Bank of England has kept the interest rate at 5.25 per cent.
It’s the first time that the Bank of England has maintained the base rate after 14 consecutive increases.
A high interest rate means that those with a variable-rate mortgage have been paying more each month, and first-time homebuyers and people switching from fixed-rate mortgages have been paying more for new home loans.
While the Bank of England’s decision to refrain from changing the interest rate this month may come as a relief to those with mortgages, it doesn’t mean that inflation will necessarily drop to where it needs to be.
The latest interest rate announcement came shortly after the Bank of England’s Governor revealed that the UK is “much nearer” to the top of the cycle of interest rates. At the start of September, he told MPs that there is no longer a clear upward path for interest rates during a Treasury Committee session.
So what do we know about current interest rates and could there be a new trend of holding current interest rates in place?
When is the next interest rate announcement?
The Monetary Policy Committee announces any change in interest rates every six weeks and the next will be on November 2.
The committee will share its summary and minutes, including the current interest rates.
Will interest rates go up?
While interest rates were maintained for the first time in 14 consecutive rounds, that doesn’t mean the next announcement will be the same.
Interest rates are expected to increase again, with some experts expecting interest rates to rise slightly by the end of the year. Find out more about why interest rates rise in our guide.
However, several analysts think the cycle of rising interest rates may be coming to an end. According to the Office for National Statistics, the UK’s annual inflation rate fell from 7.9 per cent to 6.8 per cent in July — the lowest level since March 2022.
Since December 2021, the Bank of England has increased the base rate from 0.1 per cent to five per cent.