Bank of England cut the base rate

The Bank of England have today cut the base rate. Despite warning that Rachel Reeves budget will complicate its battle against inflation.

The decision to cut the base rate from 5% to 4.75% was widely anticipated by the financial markets, the MPC (monetary policy committee) were in favour of the cut by eight votes to one. With a word of caution around the new government’s tax and spending plans released in their latest budget could cause pressure on inflation as inevitably these costs get passed down to the consumers.

Andrew Bailey, the govenor of the bank of england said “We need to make sure inflation stays close to target, so we can’t cut interest rates too quickly or by too much. But if the economy evolves as we expect it’s likely that interest rates will continue to fall gradually from here,”

Inflation was down to 1.7% in September, however they expect this to increase over the coming months inline with Ofgem’s energy price cap increase coming into affect in October.

Over the coming months we hope the ongoing battle to keep inflation low and cut the Bank of England base rate will continue, however understandably this is somewhat unknown due to the changes the government have made on taxation and spending, our current predictions are that the rates will stay the same until the end of the first quarter in twenty twenty five, at which point we hope the BoE (Bank of England) cuts will start coming think and fast. But as we all know things change quickly and these thoughts could be quickly outdated in the ever changing world we live in.

Our advice to those considering what to do on their mortgage is to secure your rate now and continue to review with your broke as the landscape changes.