The Bank of England's Monetary Policy Committee voted 8–1 on 30 April 2026 to hold Bank Rate at 3.75% for the third consecutive meeting, with one member preferring an immediate increase to 4%. The decision reflects a sharp shift in the rate outlook since the Iran conflict began driving oil and energy prices higher in late February.
The vote and the message
Eight MPC members backed the hold; one voted for a 0.25 percentage-point increase. The Committee's published rationale flagged that CPI inflation has risen to 3.3% in March 2026 and is "likely to be higher later this year" as energy costs pass through the economy. The MPC explicitly raised the prospect of "forceful" rate rises if second-round effects from wages and pricing take hold.
Before the conflict escalated in late February, markets were pricing rate cuts beginning in spring 2026. That has reversed. Reuters' poll of economists now splits roughly into thirds: 33 expect rates unchanged through 2026, 14 expect at least one hike, and 15 expect cuts.
What it means for mortgage borrowers
Fixed-rate mortgages move with swap rates, not directly with Bank Rate, and swap rates have been volatile. Major lenders including Nationwide, HSBC, Halifax and Santander began trimming fixed rates in late April after a sharp March spike, but Which? and HomeOwners Alliance both warn the cuts may slow or reverse if swap rates resume rising.
| Mortgage type (May 2026) | Indicative best rate | Reverts to |
|---|---|---|
| 2-year fix, 60% LTV, no fee | 4.74% (Nationwide) | 6.49% SVR |
| 10-year variable, 60% LTV | 4.55% (First Direct) | variable |
| Average UK SVR | 7.13% | — |
For a £250,000 repayment mortgage over 25 years, a 0.5 percentage-point rate difference works out to roughly £67 a month, or more than £20,000 over the full term.
What it means for savers
Half of UK savings accounts now beat Bank Rate, according to Moneyfacts data cited by MoneySavingExpert. Top easy-access deals sit at around 4.5% (Trading 212, Chase for new customers), and the leading fixed-rate deals reach 4.66–4.67% from MBNA and Kent Reliance.
The next decision
The MPC's next rate decision is scheduled for 18 June 2026. Governor Andrew Bailey has said the path forward will "depend on the size and duration of the energy price shock" and declined to give a "cast iron assurance" against further rises even if oil prices ease.
The May ONS inflation release on 20 May 2026 will be the next major data point. CPI for March was 3.3% and the Bank's preliminary estimates put the second and third quarters of 2026 in the 3% to 3.5% range.
Disclaimer
This article is for general information only and does not constitute financial or mortgage advice. Mortgage rates change frequently. Speak to a qualified, FCA-authorised mortgage broker or independent financial adviser before making decisions about borrowing or saving.
Sources
- Bank of England — Monetary Policy Summary, 30 April 2026
- Office for National Statistics — Consumer price inflation, UK: March 2026
- House of Commons Library — Inflation in the UK: Economic indicators
- Trading Economics — United Kingdom Interest Rate (April 2026 release notes)
Feature image: Photo by Georg Eiermann on Unsplash.
