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Bank Base Rate held at 0.5%

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The Bank of England has kept the Bank Base Rate (BBR) frozen at its record low level.
Bank Base Rate held at 0.5%

In its first sitting since the arrival of new governor Mark Carney this Monday, the Monetary Policy Committee at the Bank of England has voted to maintain the BBR at the 0.5% where it has remained since March 2009.

Responding to recent speculation over the possibility of a rate rise, the Bank’s report said:

“In the committee’s view, the implied rise in the expected future path of Bank Rate was not warranted by the recent developments in the domestic economy.”

George Osborne has requested the committee consider whether it would be appropriate to provide some forward guidance on possible future interest rate rises. But this won’t be discussed until August.

Mortgage borrowers have welcomed the news.

Jeremy Duncombe, director of Legal & General Mortage Club, said:

“With Mark Carney only just settling down at his desk it is unsurprising that the committee hasn’t done anything drastic this month. That said, interest rate rises are inevitable in the future as they remain at historical lows.

“Many mortgage borrowers have been able to take advantage of this situation and secure cheaper fixed rates as a result. However, with upward movement on swap rates now likely to be passed on to consumers, the window of opportunity to secure these low rates is slowly closing.

“Those in a position to remortgage should speak to an adviser now, and seriously consider whether they may be able to secure a better deal for themselves before the rates start to move again.”

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