Bank of England holds Bank Rate at 3.75%
Welcome to our live blog!
14:35 p.m.: That's a wrap folks!
We're ending our live coverage here. Follow the story with Rommel Lontayao who gathered insights from industry professionals about what a base rate hold means for mortgages.
14:25 p.m.: Economist weighs in
James Bennett CFA, UK Lead, BMI (a Fitch Solutions Company) says:
“The Bank of England’s Monetary Policy Committee (MPC) implemented an uncontroversial rate hold at 3.75% at the February 5 meeting, in line with our own view and consensus. However, the vote split at the meeting was surprisingly close, with the dissenters preferring a 25bps rate cut, triggering a repricing lower for short-end rates and sterling as the prospects of more rate cuts rose.
“The big surprise here was a shift in rhetoric from Catherine Mann, who at various points has been the most hawkish and dovish member of the committee. Mann noted that the 'time for a cut in Bank Rate [was] closer', compared to her recent more hawkish stances.
Shifts in dynamics on the MPC have raised downside risks to our projection of an end-2026 Bank Rate of 3.25%, although we do remain confident in this outturn as a base case.”
14:20 p.m.: Europe's central bank holds firm
Europe’s central bank also left its key interest rate unchanged at 2% today, marking a fifth consecutive hold for all Euro-using countries as inflation remains within target, helped by lower energy costs.
14:00 p.m.: Bailey is asked about Warsh
At the press conference, Bailey is asked about President Donald Trump’s nomination of Kevin Warsh to lead the US Federal Reserve. He welcomes the prospect, noting he has known Warsh for many years, but also reiterates his public support for current chair Jay Powell and the principle of the Fed’s independence.
He pushes back firmly on any suggestion of a “Jay versus Kevin” struggle.
13:40 p.m.: BoE's Monetary Policy Report
Alongside the Bank Rate decision, the BoE’s latest Monetary Policy Report underlines that CPI inflation, at 3.4% in December, is now projected to fall close to 2% by mid‑2026, helped by lower energy bills and Budget 2025.
The Bank estimates “target‑consistent” wage growth at around 3.25%, with current pay growth still somewhat above levels fully consistent with the 2% goal, and stresses that labour‑market slack is building, with unemployment seen rising to about 5.3% by mid‑2026.
While the MPC judges the risk of persistent inflation has diminished and signals Bank Rate is likely to be reduced further, it warns that future cuts will be a “closer call” and remain tightly data‑dependent.
13:20 p.m.: When might we see cuts?
Just a reminder: the Bank of England’s Monetary Policy Committee reviews and sets the UK base rate eight times a year, usually at six-week intervals.
This year’s remaining interest rate decision dates are:
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Thursday 19 March
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Thursday 30 April
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Thursday 18 June
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Thursday 30 July
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Thursday 17 September
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Thursday 5 November
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Thursday 17 December
13:10 p.m.: Market confidence builds
Jason Tebb, President of OnTheMarket says:
“With inflation rising to 3.4 per cent in the year to December, caution prevailed this time around with the rate setters adopting a ‘wait and see’ approach, although the vote was split with four of the nine members voting for a 0.25 percentage point reduction.
While this will be disappointing for those on variable-rate mortgages, borrowers have benefited from six rate cuts in the past 18 months, giving much-needed impetus to the market.”
Amy Reynolds, head of Antony Roberts says:
“The expectation was that the Monetary Policy Committee would hold rates at 3.75 per cent at this meeting, but what really matters for the property market is the tone rather than the decision itself.
“Markets are already pricing in cuts later in the year, and that shift in sentiment has fed through to mortgage pricing and buyer confidence.”
Jeremy Leaf, north London estate agent and former RICS residential chairman notes:
“Following the first rise in inflation for five months in December, it’s no surprise rates have been held this time around but it is worth noting that they are still at their lowest level in almost three years, which is certainly helping boost buyer and seller confidence.
“We know what homeowners like least is uncertainty and if there is a sense that there is little prospect of a reduction in rates in the near future then some of the early 2026 optimism that we have witnessed in our offices is likely to fizzle out.”
Mark Harris, chief executive of SPF Private Clients adds:
“We are hugely encouraged by four members voting for a reduction in base rate to 3.5 per cent and hope more of the Committee come round to their way of thinking in due course. Market expectations are for a further quarter-point reduction at the April meeting with perhaps one or two more reductions this year, with base rate potentially settling at around 3 per cent.
“Those who are coming up to take out a new deal this year or remortgage should consider securing a product now… if rates have fallen again, you should be able to move onto a cheaper rate. However, if they have risen, you will be pleased you took action and secured a rate when you did.”
13:05 p.m.: Rate cut in March?
Lindsay James from Quilter told the BBC that the narrower-than-anticipated vote clearly points towards an eventual cut: “This is a much closer split than had been expected, and the Bank’s stance has shifted somewhat, clearly outlining that it expects rates to be cut further based on the current evidence”.
She adds: “Crucially, the Bank will also want to see evidence of cooling wage growth.
"Recent payrolls data has shown persistent weakness in the labour market, and this could bring pay settlements, and subsequently inflation, down faster than the Bank currently assumes.
”Slower wage growth will mean a cool-off in the economy, bringing inflation down further, clearing the way for a rate cut."
13:00 p.m: BoE decision “reflects the reality brokers are living in”
Colin Bell, Founder and COO of Perenna, says: “A hold will feel disappointing to some, but it reflects the reality borrowers are already living in: higher rates are no longer a temporary phase. They are here to stay as inflation remains sticky, and for many households, it is simply better to opt for long-term certainty now, than to keep holding out for a quarter-point cut later in the year that will make little difference to their monthly finances.
It’s increasingly clear that rate decisions alone aren’t shifting the dial on homeownership. The average first-time buyer is now well into their thirties, and around a third of renters aged 25–44 say they don’t expect to ever own a home. That tells us the challenge isn’t whether the base rate has moved this month, but whether the system is actually opening the door rather than leaving people knocking.
We need to stop treating rate cuts as the solution and focus instead on products and policy that give borrowers more control, flexibility and longer term stability. That’s where real progress will come from.”
12:55 p.m: More broker reactions
David Hollingworth, associate director at L&C Mortgages comments:
“Although the base rate fell in December, the tone was cautious and a subsequent rise in the rate of inflation didn’t boost hopes for another rate cut to come this soon. The decision to hold is therefore one that was widely anticipated.
“The hold therefore won’t come as a shock to markets, which should avoid causing any turbulence for mortgage rates. There is still a broad expectation that interest rates will fall further through the course of this year, which is already broadly priced into fixed rates.
“The fact that 4 members of the committee voted to cut the base rate again this month should be received positively. The tone could give markets more confidence that another cut will be applied in coming months, with potential for more as the data firms up to support more reductions.
“However, borrowers can’t afford to be complacent as we have seen a growing number of lenders edging their fixed rates up recently. As more lenders edge rates higher it only makes it more likely that others will follow in the short term.
“This isn’t resulting in rocketing rates but does act as a sharp reminder to borrowers that things can change quickly. Today’s news may help to limit those increases if markets take the positives on board and swap rates could even ease back a touch.
“It still makes sense for those that coming toward the end of a fixed rate deal this year to keep focused on shopping around and securing a rate a few months ahead. That will avoid any further increases in mortgage rates but still allows enough flexibility to review the deal again before completion if rates do ease back again.”
12:40 p.m: “Good news,” says Andrew Bailey
“My main message today is one of good news,” says Bank Governor Andrew Bailey.
He says the disinflation process is progressing well and appears to be running ahead of the pace the Bank had pencilled in back in November.
But he stresses that policymakers still need to ensure inflation returns to the 2% target “and stays there.”
As a result of disinflation running ahead of schedule, Bailey says there is room to start cutting rates, but lingering risks mean it is far too early to say how fast or how far those cuts might go.
12:35 p.m: BoE press conference to be held
The Bank of England's press conference will soon be underway.
Governor Andrew Bailey will soon be taking questions, joined by fellow rate-setters and deputies Dave Ramsden and Clare Lombardelli.
Stay tuned for more!
12:15 p.m: Brokers deliver their verdict
Nicholas Mendes, Mortgage Technical Manager at John Charcol says:
“A decision to hold Bank Rate at 3.75% comes as little surprise and shouldn’t be read as a change in direction.
Inflation remains above target and the more stubborn elements of price growth, particularly services and food, haven’t softened enough to make another cut feel comfortable just yet. Rates were only cut in December, and policy works with a lag, so holding now gives the Bank time to assess whether easing wage growth and a softer labour market begin to feed through without adding unnecessary volatility.
Markets had long priced a hold, so the real signal will be the vote split and the Governor’s tone. Any indication that the door remains open to cuts later in the year will matter more than the decision itself.
From here, it’s less about staying on hold and more about moving in smaller, less frequent steps. Pricing is likely to follow swaps more closely, with lenders making incremental adjustments to manage service levels and pipeline volumes rather than reacting to the base rate decision alone. The modest increases seen from some lenders this week look more like short-term recalibration than a shift in direction.
If swaps move materially lower on renewed optimism around inflation or growth, lenders still have scope to reprice more competitively. For now, the market points to a gradual easing path rather than an aggressive cutting cycle, with any further cuts later this year likely to be measured rather than rapid.”
Meanwhile, Ash Ajaz of Focus Finance Solutions says:
“I think holding at 3.75% is the right call. Inflation only picked up again a few days ago, so cutting now would risk stoking it further. Everyone wants a rate cut – I want a rate cut too – but what we don’t want is a cut now and then a hike straight after. That would just disrupt the market even more.”
“I’m still expecting a cut later this year – maybe around Easter time if the data allows it. They gave us a Christmas present with the last cut; hopefully we get an Easter present as well. My hope is we edge closer to that 3% mark by the end of the year, or at least early 2027.”
12:10 p.m: More reactions as BoE holds steady
Steve Cox, Chief Commercial Officer at Fleet Mortgages, says:
“Today’s decision by the Bank of England to hold Bank Base Rate at 3.75% comes as no surprise, particularly after inflation edged up slightly to 3.4% last month. With a cut already delivered in December, and the Bank keen to avoid moving too quickly, this pause was widely expected.
“That said, the broader expectation is still for inflation to fall through the year, which could pave the way for two or possibly three cuts to BBR during 2026, potentially taking us down to 3% by the end of the year. That may provide advisers and their clients with some degree of forward visibility but with no guarantees, and one suspects, that the pace of change is likely to remain ultra-cautious.”
Adrian Moloney, Group Lending Distribution Director at Precise, comments:
“While many borrowers will have been hoping for an interest rate reduction, a period of stability should at least provide some reassurance and help households plan with greater confidence.
“Despite the base rate remaining unchanged, there is good news on affordability - with positive movement on mortgage rates and more flexible products coming to market, to help more home buyers and movers make the leap this year.”
12:05 p.m: Lenders react to news that BoE holds rates
Joshua Elash, director of specialist lender MT Finance, says: “While further cuts are expected later this year, it is not surprising that bank rate has been held at 3.75% this time around.
“The news that UK inflation rose in the 12 months to December 2025 effectively shut down the possibility of a drop in February, particularly as the US Federal Reserve also voted against a decrease last week.
“There is still an appetite to lend though, and we are hopeful that in the absence of any rate increases, borrowers will continue to transact.”
Meanwhile Paul Noble, CEO of Chetwood Bank, says: "I don’t think anyone believes today’s result means rates will stay at their current level for long. The MPC might be getting mixed signals from the economy, but it feels like there’s a general sense that it’s only a matter of time before we see another cut.
“That expectation is already feeding into pricing, particularly at the short end of the market. Whilst we’re seeing savings rates gently ease back as the market anticipates lower bank rates later this year, longer-term borrowing costs, including mortgage pricing, remain influenced by where longer-dated swap rates settle. These have been more resilient.
“Falling swap rates will mean we almost certainly see rates go down across the entire savings space in the coming weeks, which means smart savers will look to lock down the best fixed-rate deals while they’re still high. Across the board, savers need to be alert and make sure they’re making the most of their money, particularly any funds left in low- or no-interest accounts when they could be making more of a difference.”
We'll bring you more lender, broker and economist reactions as the day continues.
12:00 p.m.: BREAKING – Bank of England holds rates
As expected, the Bank of England has held its base rate steady at 3.75%, opting to pause after December’s quarter-point cut as policymakers weigh whether cooling wage growth and a loosening labour market will be enough to steer inflation back to target.
Rommel Lontayao with the full story here.
11:50 a.m.: BoE announcement almost here
The Bank is scheduled to release its decision on interest rates in 10 minutes, at 12:00 p.m. GMT. Markets are expecting a hold, but are watching for clues on potential further rate reductions in the months ahead.
Stay tuned – we'll have all the updates here.
11:35 a.m.: Get up to speed with all our BoE coverage
Just 25 minutes to go until the Bank of England reveals its rate decision. While you wait, catch up on our latest coverage setting the scene for today’s announcement.
First up, Rommel Lontayao spoke to three mortgage brokers about how they expect the Bank to decide on rates later today.
And in case you missed it, Fergal McAlinden has also outlined what to expect for today’s Bank of England decision.
11:00 a.m.: Welcome!
Welcome to our first live blog of 2026 here at Mortgage Introducer, where we’ll be bringing you full coverage of the Bank of England’s first interest rate decision of the year.
The Bank is widely expected to hold Bank Rate at 3.75% at midday, after a series of cuts through the second half of 2024 brought it down from 5.25%.
Even if the Bank stands pat today, there will be no shortage for brokers, lenders and borrowers to chew over – especially the new Monetary Policy Report, due alongside the decision, which should shed fresh light on how policymakers are reading the economic backdrop and the inflation outlook for the months ahead.
Here’s how we’ll run things this afternoon: we’ll bring you the Bank’s rate decision as it drops at 12:00, pick out the key takeaways from the Monetary Policy Report, and then track the market reaction as the Governor and MPC set out their thinking. We’ll be gathering instant response from economists, brokers, lenders and analysts to translate the headlines into what it all means for your clients.
This is the first of eight scheduled Bank of England decisions in 2026, with further meetings lined up through March, April, June, July, September, November and December – so today’s tone-setter matters. Keep this page open, refresh regularly, and stay with us for live coverage throughout the afternoon.
