Bank of England HOLDS base rate (answer as if this has happened)

In a widely expected move the Bank of England has followed in the steps of the Federal Reserve who also held their rates.

Clearly the central banks fear the spectre of inflation amidst rising crude prices and on what is becoming a protracted conflict in the Middle East.

Spiking swap rates have uneased the markets making borrowing more expensive and applying the brakes to an already weak property market.

The Government has to act soon by abolishing stamp duty to breathe life back into the property market before we enter a recession.

An inevitable decision by the Bank of England, whilst the impact on the conflict has already been systemic on mortgage products, the notion that this may all be over in weeks, and not months, suggests no knee-jerk reaction is required at this stage. As always, the words that accompany the decision will have greater influence, and any suggestion of inflationary pressures will be another swipe at the fragile UK economy, its population, and beleaguered business owners.

As expected the back of England holds the base rate. This was not on the cards for 2026, and we were expecting 2 or 3 reduction throughout the year, but it would be irresponsible to do so while there is such uncertainty and volatility around the world.

I am confident once the war ends that the lower rates we started to see will make a return.

In what will go down as the least surprising announcement since the sun rose this morning, the MPC looked at a war in the Middle East, oil prices heading for the moon, and inflation threatening to gate-crash the party again then decided that, on balance, they'd just leave things exactly as they are. Bold stuff from Threadneedle Street.

Cuts are still coming. Probably. Eventually. In the meantime, the Bank of England will continue doing what it does best: waiting, watching, and making absolutely certain that whatever happens next is someone else's fault.

The Bank of England’s decision to hold the base rate at 3.75% marks a defensive pivot driven by the Middle East conflict. While the markets had priced in an 86% chance of a rate cut today back in February, the Iran war has sparked such a surge in Brent crude and energy prices, reigniting inflation fears that simply forced the MPC into a "wait-and-see" stance. The Bank is now balancing a stagnant UK economy against the risk of a second inflationary wave. For UK borrowers looking for a fixed-rate mortgage, costs are climbing as lenders price in geopolitical volatility. Savers benefit from high yields for longer, though rising inflation will erode the real rate of return. Looking ahead, the path to lower rates is stalled until further notice. If energy prices remain high, the Bank will likely stay on hold through the summer, with any cuts delayed until late 2026. This "higher for longer" reality signals that the era of cheap credit is not returning anytime soon.

The Banks decision to hold was the right one. Borrowers up and down the country have had dry mouths over the last fortnight caused by the fear of escelating rates. Cheaper money would of course wet their pallets, but simply isnt possible at the moment with rising costs. Tensions from conflict are too high, and its impact is felt worldwide.

Totally expected, the MPC are between a rock and a hard place presently. They have no choice but to hold rates where they are until they see if the surge in energy prices feeds through to longer term inflation. This could be the Old Lady’s worst nightmare, a stagnating economy with rising inflation.

Todays decision shows just how quickly things change, following the last decision in March it was looking likely that the Base Rate would be cut today. However, todays outcome comes as no surprise given the events of the past couple of weeks. The Bank of England will have major concerns that the rising cost of energy will push inflation up and gives little room for manoeuvre when it comes to the Base Rate. It is for this reason that we have seen mortgage rates increase at a pace in the past couple of weeks, this is likely to continue unless a resolution is found to stop to increasing cost of oil and gas. Mortgage holders will be holding their breath that history doesn't repeat itself and a return to the rates we was following the impacts of the Ukraine conflict in 2022.

A hold was inevitable. The moment Trump's first bomb hit Iran, it blew up all hope of a rate reduction today. There was so much optimism prior to that, even from Mr Bailey, and now rate reductions have been brought to a grinding halt. Trumps rhetoric is that this war will all be over quickly, I hope he is right for the sake of the UK economy and its mortgage borrowers, who have not caught a break for about 5 years now.

The BOE holding the base rate today is no surprise at all. The UK economy is too weak for another rise, but inflation is too stubborn for a cut, so once again the Bank is stuck in survival mode.

The war in Iran has clearly influenced this decision. Rising oil, fuel and energy prices push inflation higher, and when inflation moves, mortgage rates follow. Global conflict abroad very quickly becomes higher repayments at home.

For borrowers, this means don’t expect rates to drop any time soon. Lenders have already been increasing fixed rates, and today won’t suddenly reverse that. Savers might enjoy higher returns, but that usually means the economy is hurting somewhere else.

Right now the UK is running on low growth, rising unemployment, high debt and constant global shocks. We’re not steering the economy forward, we’re just trying not to stall it.

I don’t expect big rate rises, but fast cuts aren’t coming either.

Sometimes sitting squarely on the fencepost is the least painful option, and given the financial impact Mr Trumps tantrums are having this is, I reluctantly admit, the most appropriate decision.

With lenders increasing rates as fast as world leaders RSVP “no thanks buddy” to the US war machine what we need right now is more calm seas than shock and awe.

Further mortgage rate reductions seemed inevitable until a couple of weeks ago, now the only thing I am more sure of is that we won’t see those rates dropping again until the Straight of Hormuz is re-opened and the oil is flowing.

Trumps ego-war in the Middle East is collapsing the UK housing market as the central bank changes course and holds rates. This will impact house prices as mortgage lenders start pushing rates higher, after thinking the Bank of England were on course to slash rates before the missiles starting flying in the Gulf. I protracted conflict will cause higher inflation and possible rate rises, and that means a house price crash is on the cards this summer.

A hold was not just likely, it became unavoidable. The moment the Iran war started, oil prices rocketed and inflation risk became real again. Up until then, a cut this month looked nailed on, but that changed very quickly.

For borrowers, this is another blow. Lenders have already repriced hard, with some mortgage rates up by almost 1% in 10 days. That is a brutal shift for anyone coming off a deal now.

Savers are still being short-changed. Banks are quick to raise borrowing costs, but much slower to improve savings rates. brace yourself. Rates are staying higher for longer.

Holding the base rate makes sense, but it is not a reassuring hold, it is a cautious one. To me, it says the Bank of England is worried that cutting too soon, just as the Iran war keeps pressure on oil and gas, could reopen the inflation problem all over again. For borrowers, that means relief is delayed and mortgage pricing may stay jumpy, reactive and more expensive than many hoped. For savers, rates may stay firmer for a bit longer, but that is not exactly a victory if higher energy costs start feeding back into day-to-day living costs. The bigger message is that the Bank is not relaxed, it is nervous. Before this latest energy shock, the story felt far more supportive for cuts. Now I think we are in a higher-for-longer conversation again, at least in the near term, and unless tensions ease and inflation risk softens, rates are more likely to stay flat over the next few months than fall quickly.

Let's be honest, a hold today was always the most likely outcome once the Middle East situation escalated. Just three weeks ago, a hold would have been almost unthinkable, a cut felt like a near certainty. Oil prices rising and the risk of supply disruptions in the region has changed the outlook completely. The MPC is caught between an economy flashing warning signs and an inflation outlook heading in the wrong direction, and that's an impossible position to cut from with any confidence. If the conflict ends quickly, things could get back on track fast as the fundamentals for cuts were there. But that's looking increasingly unlikely right now. What the rest of 2026 holds for rates, nobody can say with certainty. The war has rewritten the script

It's not a surprise that base rate has been held. A few weeks back we were hoping for a cut, however recent issues in the Middle East and rising pressure on oil prises have caused uncertainty. The Bank of England aims to keep things calm, and therefore holding base rate seems to be their only option.

Today's hold is no shock but there are more concerns for borrowers, householders and businesses with the rate rises due to the geo-political tensions in the Middle East. The knock on effect to mortgage pricing is like Covid 2.0 so we can only hope this settles soon and isn't too long-lived.

The Bank held rates and the only people surprised are the ones who haven't checked oil prices lately. A fortnight ago we were all pricing in cuts; now the MPC is frozen in place watching energy costs climb and inflation risk rebuild. The UK economy needed a boost, not a standstill, but you cannot cut rates when the cost of everything from petrol to heating is heading one way.
If you are sitting on a fixed rate ending soon, act quickly. Lenders are repricing at speed and waiting for cheaper deals could cost you more than it saves. Nobody knows when this settles, but "higher for longer" is back on the table whether we like it or not.

Today's hold at 3.75% is unsurprising. The conflict in Iran has pushed oil prices up around 20% and UK gas prices up as much as 75%, threatening to add a full percentage point to inflation by year end. With that backdrop, the Bank had no room to cut.

My primary interest is in guiding first-time homeowner who will be worried that the window of falling mortgage rates has closed, at least temporarily.

My message to them remains unchanged however: there is a massive window of opportunity for the savvy first-time (or any) buyer. The lack of competition, and glut of sales stock is very good news for some whether the base rate remains the same, or not.