The Bank of England has made a notable decision by voting to keep the base rate steady at 5.25%, marking a departure from the 14 consecutive rate hikes that began back in December 2021. This is indeed a significant development as it signifies the first instance in nearly two years that the central bank has chosen not to raise the base rate.
In a close vote of 5-4, the Monetary Policy Committee (MPC) arrived at this decision. This move comes on the heels of some promising inflation data recently published by the Office for National Statistics (ONS), revealing a slight dip in inflation by 0.1%, settling at 6.7%.
Amid concerns about a looming economic downturn, the MPC’s choice to maintain the base rate hints at a gradual recuperation of the economy, following months of upheaval. This period included a peak in inflation at a 40-year high of 11.1% in October 2022, alongside an ongoing cost-of-living crisis that imposed mounting financial burdens on households across the United Kingdom.
For homeowners and mortgage brokers, this decision provides a welcome respite after enduring months of escalating mortgage rates and concerns about affordability.
