Bank of England holds Bank Rate at 4.25% in May meeting
The Monetary Policy Committee voted to keep the base rate unchanged for a second meeting running, with two members favouring a cut.
By Money Guide editorial team
Published:
The Bank of England's Monetary Policy Committee held Bank Rate at 4.25% at its May meeting, the second consecutive hold after a sequence of quarter-point cuts through late 2025 and early 2026.
Seven members voted for the hold; two voted for a quarter-point cut. The minutes noted that services inflation remains stickier than headline CPI and that wage growth, while easing, is still running above levels consistent with the 2% target.
For households, the immediate effect is more of the same: easy-access savings rates have crept down from their late-2024 peaks but remain well above where they were before 2022, and tracker and SVR mortgage payments are unchanged. Fixed-rate mortgage pricing has softened slightly on the back of falling swap rates, with the cheapest two-year fixes for 60% LTV now under 4%.
Markets are pricing in one further quarter-point cut by the end of 2026, taking Bank Rate to 4.0%, although the path will hinge on the next two CPI prints and the Autumn Budget's fiscal stance.