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"A rate cut by the Bank of England next month looks as certain as death and taxes"

ended 11. July 2025

MAY's bleak economic data, with the economy contracting by 0.1%, will boost the chances of a rate cut by the Monetary Policy Committee next month, experts have said, which “will be good news for borrowers”.

Rakesh Dua, CEO at DUA Accountancy & Business Consultancy, said: “The Bank of England is now far more likely to cut rates next month in an effort to address the downturn and boost sentiment among borrowers and businesses alike. Mortgage costs will come down and they need to given the pressure households are under.”

It's a view shared by Adam Stiles, Managing Director at Helix Financial Partners, who said: "May's bleak economic data could be good news for borrowers. The consecutive monthly contraction in GDP will be of concern to the Bank of England and the Government. The odds of a rate cut will be slashed on the back of this news."

David Stirling, Director at Mint Mortgages & Protection, said “a rate cut by the Bank of England next month looks as certain as death and taxes, but much more welcome”.

He added that “all current data looks to be forcing Threadneedle Street in one direction. This will drive further competition between lenders, which can only be sunny news for borrowers”.

Harry Goodliffe, Director at HTG Mortgages, agreed that Threadneedle Street may have no option but to act: “A rate cut in August is looking more and more like a done deal. With two months of negative GDP, easing inflation and falling consumer confidence, the Bank of England really has no excuse to hold fire. Markets will likely start pricing it in fast, and we could see swap rates trend down. That means more room for mortgage lenders to cut, and hopefully a bit of breathing space for borrowers who’ve had it rough for too long.”

Rob Mansfield, Independent Financial Advisor at Rootes Wealth Management, commented: "The case for a rate cut was already fairly strong and today's GDP numbers strengthen it further. It will help soften the blow for those who fixed for 5 years during COVID who now face a big rise in borrowing costs."

But Justin Moy, Managing Director at EHF Mortgages, warned: “The gap between equivalent fixed and tracker mortgage deals is way above 0.5%, so this suggests there are at least two base rate cuts factored into fixed deal pricing. But remember: it takes a few loose words from world leaders and things can quickly go into reverse.”

7 responses from the Newspage community

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Rakesh Dua
CEO at DUA Accountancy & Business Consultancy
The Bank of England is now far more likely to cut rates next month in an effort to address the downturn and boost sentiment among borrowers and businesses alike. Mortgage costs will come down and they need to given the pressure households are under. And lower rates will also stimulate people to spend. The number of wealthy individuals leaving the country has caused alarm is being played down politically but is highlighted in capital letters economically.
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Adam Stiles
Managing Director at Helix Financial Partners
May's bleak economic data could be good news for borrowers. The consecutive monthly contraction in GDP will be of concern to the Bank of England and the Government. The odds of a rate cut will be slashed on the back of this news.
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Harry Goodliffe
Director at HTG Mortgages
A rate cut in August is looking more and more like a done deal. With two months of negative GDP, easing inflation and falling consumer confidence, the Bank of England really has no excuse to hold fire. Markets will likely start pricing it in fast, and we could see swap rates trend down. That means more room for mortgage lenders to cut, and hopefully a bit of breathing space for borrowers who’ve had it rough for too long.
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David Stirling
Independent Financial Adviser at Mint Wealth
A rate cut by the Bank of England next month looks as certain as death and taxes, but much more welcome. A cut was very close last month and all current data looks to be forcing Threadneedle Street in one direction. This will drive further competition between lenders, which can only be sunny news for borrowers.
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Tony Redondo
Founder at Cosmos Currency Exchange
The Bank of England should bring out its big bazooka and cut by at least 0.5% to try and kickstart the UK economy back to life. The case for a BoE rate cut is now overwhelming following May’s 0.1% GDP contraction and April’s unrevised 0.3% drop, 4.6% unemployment, though inflation at 3.4% and global risks (e.g., U.S. tariffs, Middle East tensions) may allow the ever-cautious BoE to sit on their hands and not cut at all. Swap rates have fallen to ~3.5%, with sub-4% mortgage deals emerging.
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Rob Mansfield
Independent Financial Advisor at Rootes Wealth Management
The case for a rate cut was already fairly strong and today's GDP numbers strengthen it further. It'll help soften the blow for those who fixed for 5 years during COVID who face a big rise in borrowing costs.
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Justin Moy
Managing Director at EHF Mortgages
It looks more likely we will see a rate cut if the economy indicators are backing the relative mood of the country. The gap between equivalent fixed and tracker mortgage deals is way above 0.5%, so suggests there are at least two base rate cuts factored into fixed deal pricing. But remember: it takes a few loose words from world leaders and this can quickly go into reverse.