Following a reduction in November, the rate has been held at 4.75%.
The hold comes as a result of inflation increasing for a second consecutive month to 2.6% (November 2024), which remains higher than the Bank of England target rate of 2.0%.
Stephanie Daley, Director of Partnerships at mortgage advisor Alexander Hall, commented:
“The Bank of England’s decision to hold interest rates at 4.75% comes as no surprise, given the current economic climate. With UK inflation rising to 2.6% in November – the second consecutive monthly increase – and core inflation climbing to 3.5%, there’s clear upward pressure on prices.
For borrowers and homeowners, stability in the base rate this month goes hand in hand with the expectation of a very slow downward movement in the base rate.
Forecasts still expect future base rate drops next year but in the short term the sustained inflation trend will likely keep lenders vigilant and mortgage pricing reflective of longer-term uncertainties.
It is essential for both home movers and remortgage clients to seek advice in order to navigate these challenges and find solutions that best suit their financial situations in what still remains a very changeable market.”
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