Bank of England Base Rate – March 2024

The Bank of England have today announced that they will be leaving the Bank of England Base Rate unchanged at 5.25% for the fourth consecutive month.

The Monetary Policy Committee (MPC) voted by a majority of 8–1 to maintain Bank Rate at 5.25%. One member preferred to reduce Bank Rate by 0.25 percentage points, to 5%.

This decision comes after yesterday’s announcement that inflation had fallen by a larger than anticipated amount to 3.4% in the 12 months to February 2024, down from 4.0% in January.

The largest downward contributions to the monthly change came from food, and restaurants and cafes, while the largest upward contributions came from housing and household services, and motor fuels.

The all-important Core Inflation rate, (excluding energy, food, alcohol, and tobacco) rose by 4.5% in the 12 months to February 2024, down from 5.1% in January.

Andrew Montlake, MD of Coreco mortgage brokers commented, “Whilst the outcome of the latest MPC meeting was predictable, there is some comfort in that at least there was no member of the Committee voting for a rise this month.

“Whilst this shift is a clear indication of future direction of travel, it is nonetheless another opportunity missed for an early rate cut which is something the country is crying out for.

“After the positive inflation news yesterday, and despite the fact we are not out of the woods just yet, the Bank is yet again putting itself into a position of having to be reactive later rather than being proactive earlier, with people all over the country being held to ransom under the weight of higher interest rates.

“We should hopefully see some downward movement in SWAP rates now, which will help give mortgage lenders the room to return to a more competitive mortgage rate environment”.