Are We Likely to See a Reduction in the Base Rate of Interest Before the End of 2025?

The Consumer Prices Index (CPI) rose by 3.8% in the year to September, below most economists’ predictions. Following the data, analysts said a rate reduction could come at one of the next two meetings of the Bank of England’s Monetary Policy Committee (MPC). 

 

While inflation remains nearly double the Bank’s 2% target, it is expected to ease further over the next two years. 

 

A cut in the Bank Rate, currently at 4%, would offer some relief to mortgage borrowers facing higher repayment costs and normally when we are heading towards the end of the year some of the bigger lenders do lower their rates to attract business and it may well happen again over the coming weeks. 

The next meeting of the Bank of England's MPC is on the 6th November and whilst experts predict a cut in November to be unlikely there is optimism for a cut in the December meeting which takes place a week before Christmas. 

 

We also have next months budget and with chancellor Reeves laying the groundwork for lowering the cost of living in the upcoming Budget, then forecasters continue to think that a December rate cut is very much in play.