Base Rate Held at 5%

Today, as expected, the Bank of England voted to hold base rate at 5% for June as they try to tackle rising inflation.

After May’s 8-1 vote in favour of a hold, and the worse than expected inflation figures, it has come as no surprise that the bank has elected to focus on inflation rather than cut rates in order to help homeowners & the slowing ecomony in general.

The Council of Mortgage Lenders director general Michael Coogan says: “We expected the MPC to hold rates today as it wrestles to control rising inflation in a weaker economic outlook.

“But clearly there are still affordability pressures on borrowers and a widespread funding shortage for lenders. We hope that as the effects of the Bank of England’s liquidity scheme feed through the financial system there will be some benefits for mortgage lenders, and in turn borrowers, later in the year.”

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