TL;DR
Bank of England Bank Rate has been held at 3.75 per cent since December 2025. Governor Andrew Bailey has signalled tolerance for inflation running above the 2 per cent target while Middle East energy uncertainty continues. Cash savings rates remain elevated; fixed-rate mortgages are still pricing in cuts that have not arrived.
Last reviewed 3 June 2026
Key facts
- Bank Rate: 3.75 per cent, unchanged since December 2025.
- April 2026 MPC vote: 8 to 1 to hold (one member voted to raise to 4 per cent).
- CPI inflation: 2.8 per cent in April 2026, down from 3.3 per cent in March, but still above the 2 per cent target.
- The next MPC decision is scheduled for 18 June 2026.
- Bailey said the Bank is 'in no rush' to raise rates while Middle East energy supply remains uncertain.
Where Bank Rate is and where it is going
The Monetary Policy Committee held Bank Rate at 3.75 per cent at its April 2026 meeting, by an 8 to 1 vote. One member voted to raise the rate by 0.25 percentage points to 4 per cent, citing inflation persistence. Bank Rate has been at 3.75 per cent since December 2025, marking the sixth cut from the 2024 peak.
Governor Andrew Bailey, in a speech in late May 2026, said the Bank is 'in no rush' to raise rates while the outcome of the Middle East conflict remains uncertain. He said it was tolerable for inflation to remain above the 2 per cent target during the current crisis but that the position would change if a more permanent increase in prices began to take effect.
The next scheduled MPC decision is 18 June 2026. The April Monetary Policy Report set out three scenarios for the UK economy depending on the scale and duration of the energy supply shock.
What this means for savers
Cash savings rates remain elevated relative to the post-2008 era. The Ofgem energy price cap reduction in April 2026 has eased headline CPI, but core services inflation has been stickier. The Bank's signal of patience implies cash savings rates are unlikely to fall sharply in the near term.
For UK savers:
Easy-access: Top easy-access rates are tracking around Bank Rate. The Financial Conduct Authority's Consumer Duty rules require firms to justify spreads between savings rates offered to new and existing customers, so loyalty penalties have narrowed.
Fixed-rate bonds: One-year and two-year fixed bonds have been pricing in expected cuts, so they often pay below Bank Rate. The trade-off is rate certainty.
Cash ISAs: The personal allowance for ISA contributions remains £20,000 per tax year. The Personal Savings Allowance (£1,000 for basic-rate, £500 for higher-rate taxpayers) means cash ISAs make more sense for higher-rate taxpayers with larger savings balances.
What this means for mortgage borrowers
The mortgage market has been pricing in Bank Rate cuts that have not yet arrived. Two-year fixed rates and five-year fixed rates have moved within a narrow band since the December 2025 cut.
For borrowers approaching the end of a fixed-rate deal:
Standard Variable Rate exposure: SVRs are typically Bank Rate plus a margin. Reverting to SVR is rarely the cheapest option. Most borrowers should engage a broker or the existing lender at least four to six months before the fixed period ends.
Tracker mortgages: Tracker rates move directly with Bank Rate. They suit borrowers who expect rate cuts ahead and accept the risk of rises.
Fixed-rate certainty: The decision between two-year and five-year fixed rates depends on confidence in rate forecasts. Five-year rates currently price in modest cuts; two-year rates price in more.
The Financial Conduct Authority's mortgage market rules require lenders to assess affordability against a stressed rate. The stress rate moves with the Bank's market expectations.
Advisory: Mortgage and savings rate trajectories are driven by market expectations of future Bank Rate, not just the current level. A single MPC meeting rarely changes the long-end of the curve significantly. Use the FCA's Money Helper service or a regulated mortgage broker for personalised advice.
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Disclaimer
This article is for general information only and does not constitute financial, legal, tax, insurance, or investment advice. Kael Tripton Ltd is registered with the Information Commissioner's Office (ICO ZC135439) as a data controller but is not authorised by the Financial Conduct Authority. Figures and rules are correct at time of publication and may change. Always check the primary source linked below before acting on any information, and seek advice from a qualified professional for your specific circumstances.
Sources
Frequently asked questions
What is UK Bank Rate now?
Bank Rate is 3.75 per cent. It has been at that level since December 2025.
When is the next Bank of England rate decision?
The next scheduled MPC decision is 18 June 2026. The Bank publishes its rate announcement at 12:00 BST and the Monetary Policy Report alongside.
Why has the Bank not cut rates further?
The Bank cites inflation persistence and Middle East energy supply uncertainty. Governor Andrew Bailey has said the Bank is 'in no rush' to raise rates but is similarly cautious about cutting while the supply shock works through.
Should I fix my mortgage now or wait?
This depends on personal circumstances and the borrower's view on future rates. Five-year fixed rates currently price in modest further cuts; two-year fixed rates price in more. A regulated mortgage broker can model the trade-off.
Are cash ISA rates still worth it?
Cash ISAs make most sense for taxpayers whose savings interest would exceed the Personal Savings Allowance (£1,000 for basic-rate, £500 for higher-rate, £0 for additional-rate). Below that threshold, a non-ISA easy-access account often pays more after tax.
