The base interest rate remains at 5.25% after the Bank of England’s Monetary Policy Committee voted 5-4 against an increase.
Many commentators had expected another rise in the rate, but the surprise fall in inflation probably prompted a rethink.
Inflation fell slightly last month to 6.7% from 6.8% in July, prompting some analysts to predict that the Bank would steer away from a rate rise.
Andrew Cardwell, Managing Director at Cardwells says;
“The better than expected inflation figures have helped put an end to successive interest base rate increases. This steadying of the interest rate will be welcome news to homebuyers, who have already felt the impact on mortgage rates which have risen over the summer. Stability is important to the property market, and this hold on the interest rates will offer some welcome reassurance, and may bring an element of confidence to buyers and sellers who have perhaps been undecided about making a move. It’s certainly positive news for the property market in general, particularly if people are looking to buy or sell. There has been some softening of the interest rates prior to this announcement from a number of lenders recently and this may well continue to the wider mortgage market now. This decision will also come as welcome news for the (Approx) 1.5 million households who will be coming to the end of their fixed rate mortgages this coming year.”
