The Bank of England’s Monetary Policy Committee (MPC) has voted to keep the Bank Rate at 0.5%.
The MPC also voted to maintain the stock of purchased assets financed by the issuance of central bank reserves – so-called ‘quantitative easing’ at £375 billion.
The previous change in Bank Rate was a reduction of 0.5 percentage points to 0.5% on 5 March 2009.
Stephen Smith, director, Legal & General Mortgage Club and Housing, said: “No one will be surprised by the Monetary Policy Committee’s decision to keep interest rates at 0.5%. With inflation at 0%, the lowest it has ever been, interest rates are likely to remain at their current levels for the remainder of this year.
“It is easy for homeowners to think that as the bank rate hasn’t moved that the rates that banks offer to consumers won’t have changed either. However, this is not the case. Banks don’t just look at the base rate when deciding the rates they offer to consumers, they also look at swap rates which can be very volatile. The average rate offered on a two fix over the past three years has fluctuated by 1.4% and the average 5 year fix has moved by 1.3% in the same period.
“At the moment there are some very competitive deals around and anyone who is thinking about moving house or who is coming to the end of a mortgage deal should speak to a broker now about which deal would be right for them. Those who wait until interest rates start to rise risk missing out on the best deals as bank will raise their rates long before the Bank of England makes an announcement.”
