Good News For Homeowners, Mortgage Rates Are Staying At 5.25 Percent
Bank of England has announced that mortgage rates are not going up which will bring some small relief to those living in Lincolnshire.
For that past 12 months we have heard from homeowners living in Lincolnshire including Grimsby, Skegness, Boston, Lincoln, Louth, Grantham, and Scunthorpe who have struggled with their mortgage repayments. Now, a little good news, mortgage rates are not going up this month.
The Bank of England have announced that mortgage rates will stand at 5.25 percent. It was hoped that mortgage rates would start to come down and bring much needed relief to those struggling to pay their mortgages.
Although the mortgage rates are staying put, Governor Andrew Bailey emphasized that there is no prospect of any interest rate being cut anytime soon.
He said: ‘We’ve held rates unchanged this month, but we’ll be watching closely to see if further rate increases are needed. It’s much too early to be thinking about rate cuts,’ he said.
This is not good news for the tens of thousands of homeowners in Lincolnshire who have been forced to go on mortgage holidays and who are worried about losing their home.
The Bank of England has revised its growth forecasts, painting a bleak picture for the UK economy. According to the latest projections, growth is expected to plummet to zero in the second quarter of next year and remain stagnant until the second quarter of 2025.
This forecast sets a challenging backdrop for Chancellor Jeremy Hunt, who is set to deliver his crucial Autumn Statement in the coming weeks.
The Monetary Policy Committee (MPC) has decided to maintain the current interest rate at 5.25 percent. While this decision provides some relief for homeowners, it reflects the Bank’s concerns about inflation.
Governor Andrew Bailey highlighted that higher interest rates are “working and inflation is falling,” but acknowledged that prices are still rising above the target of 2 percent.
The Bank will closely monitor the situation and consider further rate increases if necessary. However, Bailey emphasized that it is too early to entertain the idea of rate cuts.
The decision to keep interest rates on hold was backed by six members of the MPC, while three members favored a rate cut.
This marks a shift from the previous meeting in September, where the margin was five to four in favor of a hold decision. The September meeting witnessed the first hold decision in nearly two years after a string of 14 consecutive rate hikes.
The Bank of England’s decision to maintain interest rates on hold is based on its projections of reducing rates in the latter half of next year.
The Bank’s agents have reported subdued activity and growing concerns about the economic outlook. However, it is worth noting that the Bank’s forecasts have been subject to some criticism in the past.
Last year, the Bank suggested that the UK was heading for its longest recession since the 1930s but has repeatedly underestimated inflation.