Bank of England’s Monetary Policy Committee votes to increase base rate to 0.50%

by Aaron Strutt

Feb 03 2022

The Bank of England's MPC has voted by a majority of 5-4 to increase Bank Rate by 0.25 percentage points, to 0.5%. Those members in the minority preferred to increase Bank Rate by 0.5 percentage points, to 0.75%.

The Bank of England’s Monetary Policy Committee (MPC) sets monetary policy to meet the 2% inflation target, and in a way that helps to sustain growth and employment. 

Aaron Strutt, product director at Trinity Financial, says: "Mortgage rates are more expensive than they were but they are still pretty cheap. Given the rising costs of living and the tax hikes coming in April, this rise will be unwelcome news for many.

"If your mortgage rate is coming to an end in the near future it is a good idea to secure a deal because the Bank of England is expected to increase again over to coming months to manage inflation."

The Building Societies Association highlights that eight in ten mortgage holders are on a fixed rate and they will continue to pay the same each month until their fixed-rate period ends. The 20% on variable-rate mortgages are likely to see their payments rise, but while this is the second rate rise in three months, the increase in their mortgage payments will be modest.

Call Trinity Financial on 020 7016 0790 to secure a mortgage or book a consultation

Source: Bank of England and Building Societies Association