Bank of England holds base rate at 5.25% for the fifth time – here's what it means for your savings and mortgage

The base rate can influence how much people save and spend, which in turn affects how much things cost – in other words, it's a tool used by the Bank of England to control inflation (the rate at which prices rise).

Despite the Consumer Prices Index (CPI) measure of inflation falling to 3.4% in February, its lowest rate since September 2021, it's still above the Bank's target of 2% – so the Bank has opted not to cut the base rate just yet.

I have a mortgage – what does this mean for me?

Since the base rate was last held, variable-rate mortgages have remained largely unchanged, while fixed rates have increased – the cheapest open market two-year fix is currently 4.53%, compared to 4.17% on 1 February 2024.

Here are the key need-to-knows for mortgage borrowers:

• For those on a fixed mortgage deal there's no change for now – but make sure to check for rates if your deal is ending soon. The amount you pay WON'T change during the fixed period, regardless of what happens to the base rate. Though this also means you're locked in if interest rates were to come down.

  If you're looking for price certainty and you're close to the end of your current term, you might want to look for a new mortgage deal now. You can usually lock in a mortgage offer six months ahead of time. This will give you insurance against any rate rises, plus the flexibility to switch to a cheaper deal if one launches before your current rate finishes. 

  If your fix is ending sooner, you could consider a tracker that doesn't come with early repayment charges. That way, if rates come down over the coming months, you could move onto a fixed deal penalty-free at a time of your choosing. But bear in mind that trackers are currently around 1.3 percentage points more expensive than the cheapest fixes – so you'd need rates on fixes to come down substantially to make it worth being on a more expensive tracker rate in the meantime.

• If you're on a tracker mortgage that 'tracks' the base rate, then again there's no change. Though as above, check if you can switch to a better rate if your deal is coming to an end.

• If you've got a standard variable rate (SVR) mortgage,  these can already move at the whim of lenders. You're usually moved onto one after your fix or tracker ends. However, SVRs are typically more costly than fixed and tracker deals – currently they tend to range between around 7.5% and 8.5%. So, you should check if you can save by switching now. If you're waiting for fixed deals to come down, you may want to consider a tracker with no exit fees in the meantime.

For the pros and cons of remortgaging early or locking into a product transfer, see our Getting ready to remortgage guide.

If you're struggling with the cost of your mortgage, see our guide on What to do if you're struggling to pay. If you've already fallen behind on your repayments, see our Mortgage arrears guide.

I'm a saver – what does this mean for me?

Since the base rate was last held in February, interest rates on fixed rate savings accounts have increased, with the top one-year fix rising from 5.15% to 5.23% and the top two-year fix rising from 4.95% to 5.11%. However, rates on easy-access and notice accounts have fallen.

With the base rate being held again, it's very unlikely rates will improve in the short-term, especially on easy-access accounts (which are more closely linked to the base rate). However, the exact impact is yet to become clear.

Make sure you check what rate your provider is paying, and if you're earning less than the top easy-access rate, which is currently 5.1%, you should consider switching.

For the latest rates, see our daily-updated Top savings guide. Remember, if you've saved with an authorised bank in the UK, you benefit from the protection of the Financial Services Compensation Scheme – see our Savings safety guide for full details.