The Bank of England has today maintained the base rate at 4.25%.
The Bank’s nine-person Monetary Policy Committee (MPC) voted by a majority of 6-3 in favour of keeping the rate unchanged. Three members voted for a cut to 4%.
Read on to find out what the decision means for you, whether you’re buying a home, are due to remortgage, or trying to get the best return on your savings.
Why has the Bank of England held the base rate?
The MPC’s decision to hold the rate had been expected, following news that inflation remained at 3.4% in May.
In its June report, the MPC highlighted continued geopolitical tensions as a factor in its decision. It warned that these risks could drive energy prices back up.
The committed noted: ‘The Brent oil spot price had increased by 26% to $79 per barrel since the MPC’s May meeting, in part reflecting an escalation of the conflict between Israel and Iran’.
Overall, the MPC concluded that a ‘gradual and careful approach to the further withdrawal of monetary policy restraint remains appropriate ‘.
- Find out more: best mortgage rates and deals 2025
What this means for homeowners
Unfortunately for homeowners looking to remortgage, today’s decision is unlikely to speed up rate cuts from lenders.
In fact, since the start of June, the average two-year and five-year fixed-rate mortgage have both ticked up by the smallest of margins. This is due to lenders scaling back expectations for base rate cuts in 2025 – from three reductions to just two.
Simon Gammon, from Knight Frank Finance, said: ‘It’s difficult to imagine rates falling below 3.7% this year’.
If you’re currently on a standard variable-rate mortgage, your rate won’t change. Tracker mortgages, which are linked to the base rate, will also remain the same.
The table shows the current top rates for remortgaging across a range of loan-to-values (LTV) bands.
- Find out more: how the base rate works.
Table notes: Data from Moneyfacts, correct as of 19 June 2025. Customer scores are based on a survey of 3,556 members of the public in August-September 2024 and combine overall satisfaction with likelihood to recommend the provider. The average customer score is 70%. To become a Which? Recommended Provider a lender must get a top customer score, consistently offer competitive deals and be fully covered by the Financial Conduct Authority banking standards regime. ‘Revert rate’ is the standard variable rate (SVR), which is the mortgage rate you’d be transferred onto when your deal ended if it remained unchanged between now and then.
What this means for homebuyers
Lenders are unlikely to adjust their pricing strategy due to the base rate being maintained at 4.25%. Instead, providers will be watching inflation and economic growth figures in the months ahead.
As a result, mortgage rates for homebuyers are expected to continue edging down gradually.
Our analysis of Moneyfacts data shows that, over the past month, the average fixed-rate mortgage for first-time buyers with 90% LTV fell by just 0.01 percentage points to 5.56%. For those with a 95% LTV, the drop was 0.02 percentage points to 5.62%.
Following today’s decision, Nicholas Mendes from mortgage broker John Charcol said: ‘The message for borrowers remains the same: stay alert, plan ahead, and be ready to act if the right opportunity arises.’
The table shows the current top rates for homemovers and first-time buyers.
Table notes: Data from Moneyfacts, correct as of 19 June 2025. Customer scores are based on a survey of 3,556 members of the public in August-September 2024 and combine overall satisfaction with likelihood to recommend the provider. The average customer score is 70%. To become a Which? Recommended Provider a lender must get a top customer score, consistently offer competitive deals and be fully covered by the Financial Conduct Authority banking standards regime. ‘Revert rate’ is the standard variable rate (SVR), which is the mortgage rate you’d be transferred onto when your deal ended if it remained unchanged between now and then.
What does this mean for savings?
The Bank’s decision to hold the base rate is good news for savers with instant-access savings. The majority of these accounts have variable rates, which are linked to the base rate.
However, some variable-rate accounts may still see further cuts in the coming weeks, as a few providers continue to adjust rates following May’s reduction.
With no indication of a shift in the Bank of England’s strategy, fixed-rate savings accounts are expected to keep falling.
This table sets out the top savings rates currently available across instant-access and fixed-rate accounts.
Table notes: rates sourced from Moneyfacts on 19 June 2025. Provider customer score is based on savers’ overall satisfaction with the brand and how likely they are to recommend it to others. n/a means sample size was too small for us to generate a provider score. (a) 5% AER on balances up to £3,000
- Find out more: best savings rates 2025
When is the next Bank of England base rate review?
The MPC has a further four meetings scheduled in 2025, with the next base rate announcement due on 7 August.
Experts predict there will be further base rate cuts this year. Estate agent, Knight Frank, reported that financial markets are betting that the base rate will be cut twice more during 2025, in September and December.
However, the timing of any cuts will depend on what happens to key economic indicators, such as inflation levels and economic growth, over the coming months.
This story is regularly updated after the latest base rate decision, with rate analysis and expert views. The last update was on 19 June 2025.
