{"id":103639,"date":"2025-02-07T08:50:00","date_gmt":"2025-02-07T08:50:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=103639"},"modified":"2025-02-07T08:47:20","modified_gmt":"2025-02-07T08:47:20","slug":"bank-of-england-cuts-interest-rate-mortgages","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/bank-of-england-cuts-interest-rate-mortgages\/","title":{"rendered":"Bank of England Cuts Interest Rates to 4.5%-What It Means for Mortgages"},"content":{"rendered":"\n
The Bank of England<\/strong> has lowered its base interest rate from 4.75% to 4.5%<\/strong>, marking its lowest level since June 2023. While the decision is expected to provide relief for some borrowers, the overall impact on mortgages, savings, and economic growth remains mixed. The central bank also halved its growth forecast for 2025<\/strong>, citing ongoing economic uncertainty.<\/p>\n\n\n\n For homeowners, the effect of the interest rate reduction<\/strong> depends largely on the type of mortgage they hold.<\/p>\n\n\n\n The mortgage market had already anticipated multiple rate cuts throughout 2025<\/strong>, leading some lenders to reduce rates ahead of this decision. The Yorkshire Building Society, for example, recently cut its fixed mortgage rates by up to 0.31 percentage points<\/strong>.<\/p>\n\n\n\n While tracker mortgage holders<\/strong> will see immediate reductions in repayments, those on standard variable rates<\/strong> must wait for lender decisions. Fixed-rate mortgage rates<\/strong> may adjust over time, depending on market conditions and future rate changes.<\/p>\n\n\n\n For savers, the rate cut<\/strong><\/a> is expected to lead to lower returns on easy-access accounts<\/strong> and non-fixed savings products.<\/p>\n\n\n\n Some banks, particularly newer financial institutions, continue to offer higher returns<\/strong> to attract depositors. Raisin UK<\/strong>, for example, is offering 4.67%<\/strong> on a one-year fixed-rate bond.<\/p>\n\n\n\n Despite the rate reduction<\/strong><\/a>, the Bank of England<\/strong> has lowered its UK economic growth forecast for 2025<\/strong> from 1.5% to 0.75%<\/strong>.<\/p>\n\n\n\nHow the Rate Cut Affects Mortgages<\/h2>\n\n\n\n
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Implications for Savings Accounts<\/h2>\n\n\n\n
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The Broader Economic Outlook<\/h2>\n\n\n\n
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