It’s a hold. For now.

The Bank of England has voted to hold interest rates at 4% following one of the closest decisions in recent months. Five members of the Monetary Policy Committee voted to maintain the current rate, while four favoured a small reduction to 3.75%. The split vote highlights growing support for rate cuts, with the Bank now signalling that a move in December is a real possibility.

This cautious approach comes as the Bank looks to balance signs of cooling inflation against ongoing uncertainty in the wider economy. The latest data shows inflation holding steady at 3.8% — down from last year’s highs but still almost double the 2% target. The Bank believes inflation has now peaked, a development that could pave the way for a gradual easing of borrowing costs over the coming months.

Governor Andrew Bailey emphasised the importance of waiting to see how the economy responds to the government’s upcoming Budget before taking further action. Weakness in the labour market and subdued consumer spending remain concerns, with the Bank forecasting slower growth next year. Even so, there’s increasing optimism that the worst of the inflationary pressure has passed, which would give policymakers room to reduce rates sooner rather than later.

For homeowners and buyers, today’s decision means mortgage rates are likely to remain steady in the short term, with the potential for more positive news by the end of the year. If a December rate cut does materialise, it could offer some welcome relief heading into 2026. As always, we’ll continue to monitor developments closely — so if your current deal is ending soon, or you’re considering your next move, do get in touch to explore your options and stay ahead of any changes.