What the Bank of England decided — and why.
On Thursday 30 July 2026, the Bank of England’s Monetary Policy Committee (MPC) voted to hold the base rate at 3.75% for the fifth consecutive time. The decision was widely expected by markets and mortgage industry commentators, but the vote split was more hawkish than many had anticipated.
The MPC is a nine-member committee that meets eight times per year to decide what level of interest rates is needed to keep UK inflation at its 2% government-set target. Today’s decision was not unanimous — and the dissenting group is growing.
MPC vote — 30 July 2026
Voted to hold (6)
- Andrew Bailey (Governor)
- Sarah Breeden
- Clare Lombardelli
- Dave Ramsden
- Alan Taylor
- Swati Dhingra
Voted to raise (3)
- Huw Pill (Chief Economist)
- Megan Greene
- Catherine Mann
Why did the MPC hold rather than cut or raise?
The MPC cited several key reasons for the hold decision:
- Inflation fell to 2.6% in June — down from 2.8% in May and below the Bank’s own forecast. This gave the majority breathing space, though CPI remains above the 2% target for a 22nd consecutive month.
- Services inflation still sticky at 3.6% — the committee needs sustained evidence that inflation is returning durably to target before changing course, and services inflation remains a concern.
- Middle East conflict uncertainty — renewed fighting in Iran sent Brent crude above $100/barrel in late July before settling near $92. The Bank noted the energy picture “remains uncertain.”
- Cautious ‘wait and see’ approach — the majority prefers to monitor further data — particularly the August CPI reading and the next wage growth figures — before acting.
- New Prime Minister — Andy Burnham’s arrival introduces some uncertainty around fiscal policy direction, which the committee judged relevant to the inflation outlook.
The dissenting voices — and why they matter
Three members — Huw Pill, Megan Greene and Catherine Mann — voted to raise rates to 4%, citing the risk that second-round inflationary effects, where higher energy costs feed through into wages and services prices, could keep inflation elevated for longer than the committee’s central forecast assumes. Three dissenters is the most hawkish MPC split since 2023, and makes September’s decision a live event rather than a formality.
Bank of England base rate — last 2 years.
To understand where rates are now, it helps to see how we got here. The Bank cut four times in 2025 — from a peak of 5.25% held since August 2023 — before pausing. Every meeting in 2026 has delivered a hold at 3.75%.
All MPC decisions plotted, August 2023 to July 2026. Data source: Bank of England. Green points = rate cuts; gold point = latest hold. The rate has been held at 3.75% since December 2025.
The swap rate relationship
Think of swap rates as the mortgage market’s own forecasting tool. If markets believe rates will rise, swap rates climb, and lenders must raise fixed deal pricing — even before the Bank of England actually acts. With three MPC members now voting for 4%, swap markets are pricing a hawkish lean into the autumn, which is why locking in sooner rather than later makes sense for many borrowers.
Impact on mortgage rates.
Today’s hold means no immediate change to any mortgage rate. But the wider picture is more nuanced — here is how each mortgage type is affected:
| Mortgage type | Impact of today’s hold | Outlook |
|---|---|---|
| Tracker mortgage | No change. Tracker rates are directly linked to the base rate, so they stay at their current level. | Stable |
| Standard Variable Rate (SVR) | No change expected. Lenders may adjust SVRs independently but are unlikely to move given the hold. | Stable |
| 2-year fixed rate | Not directly impacted today, but swap markets are pricing in a hawkish tilt. Best 2-yr fixes currently around 4.1–4.3%. | Watch closely |
| 5-year fixed rate | Same dynamic — tied to swap rates. Best 5-yr fixes around 4.0–4.2% from leading lenders. | Watch closely |
| 10-year fixed rate | Longer-term fixes remain elevated. Some borrowers are locking in now to protect against a possible rate hike in September. | Uncertain |
What should mortgage borrowers do right now?
The right move depends on your situation, but here is the general picture:
| Your situation | What to consider |
|---|---|
| On a tracker or SVR right now | Your payments are unchanged after today’s hold. If you’re on an SVR (typically much higher than available fixed rates), now is a good time to speak to a broker about fixing — especially with a potential hike on the horizon. |
| Fixed deal ending in next 3–6 months | You can typically lock in a new rate up to 6 months before your current deal expires. With the September meeting now a live risk, locking in now protects against any rate hike materialising before your renewal date. |
| Looking to buy your first home | Fixed mortgage rates remain significantly below their late-2025 peak. Affordability is improving. Getting a Mortgage in Principle now puts you in a strong position ahead of September’s decision. |
| Considering whether to fix or track | With three MPC members now calling for 4%, the case for fixing is stronger than it was in June. A whole-of-market broker can model both options for your specific numbers. |
| Remortgaging later in 2026 | Watch the 17 September MPC meeting closely. If August inflation data comes in above expectations, locking in before that meeting could save you money. A broker can set up rate alerts on your behalf. |
Current BOE base rate — 3.75% · Held 30 July 2026
- Last changed
- Dec 2025
- Last change
- ▼ Cut (−0.25%)
- MPC vote
- 6 hold, 3 hike
- UK inflation (June)
- 2.6% CPI
- Next meeting
- 17 Sep 2026
- Peak (Aug 2023)
- 5.25%
Current mortgage rates
- Best 2-yr fixed
- from ~4.1%
- Best 5-yr fixed
- from ~4.0%
- Typical tracker
- ~4.1–4.5%
- Typical SVR
- ~7–8%
- Rate peak (Aug ’23)
- 5.25%
- Total cuts since peak
- −1.50%
Important information
This article is for informational purposes only and does not constitute financial advice. Mortgage rate figures are indicative as at July 2026 and change daily. MPC vote details and macroeconomic data sourced from publicly available Bank of England statements and financial news reporting. Always speak to a qualified, FCA-regulated mortgage advisor before making any decisions. Mortgage Locator is an introducer service.
Published 30 July 2026 by the Mortgage Locator team, the day of the BOE decision. Updated regularly following each MPC meeting. Rate figures correct as at date of publication.