All eyes will be on the Monetary Policy Committee (MPC) on Thursday when the Bank of England next meets to determine interest rates.
The base rate currently stands at 4.25% following recent cuts in February and May, and so will the MPC continue lowering rates?
Analysts think the answer is almost certainly no.
The interest rate is set to stay at 4.25% following a jump in inflation in April.
The current rate has reduced from the earlier 5.25% at the height of the cost of living crisis. But while some analysts had initially expected further cuts this month, they quickly altered their predictions after the hike in inflation in April.
According to the latest data from the Office for National Statistics, Consumer Prices Index (CPI) inflation hit 3.5% in April, up from 2.6% in March.
The Bank of England will now “wait and see how economic conditions and the international political backdrop evolve” before deciding whether or not to cur rates later this year.
Dates for upcoming interest rate announcements:
19 June
7 August
18 September
6 November
18 December
Ellie Henderson, an economist for Investec, said: “Although the June decision might seem clear cut, how the MPC responds to the evolving economic backdrop thereafter much depends on the details of the world in which we find ourselves.”
Most of the major lenders kept mortgage rates steady last week, ahead of the BoE next interest rate decision on Thursday.
The average rate for a two-year fixed mortgage stands at 4.89%, according to data from Uswitch. Meanwhile, five-year fixed deals average 5.14%.
Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “If inflation figures don’t hold any surprises, interest rates are held, and expectations stick for two more cuts this year, we could well see rates fall again.”
Read the orginal article: https://propertyindustryeye.com/will-interest-rates-be-cut-this-week/
