Base rate held AGAIN at 3.75% – here's what it means for you and when it might change

The base rate is used by the central bank to charge other banks and lenders when they borrow money – so it influences what borrowers pay and what savers earn.

It's also used by the Bank of England as a tool to control inflation (the rate at which prices rise). The Bank has a target – set by the Government – of 2% for the Consumer Prices Index (CPI) measure of inflation. The latest figures show that CPI inflation was 3.3% in the 12 months to March 2026 – above the Bank's target.

Why the base rate was held

On Thursday 30 April, the Bank's Monetary Policy Committee (MPC), which determines the rate, voted eight to one to hold the base rate. One member voted to increase Bank Rate by 0.25 percentage points, to 4%.

The MPC said: "CPI inflation has increased to 3.3%, and is likely to be higher later this year as the effects of higher energy prices pass through. There is a risk of material second-round effects in price and wage-setting, which policy would need to lean against.

"But the labour market continues to loosen, and a weakening economy could contain inflationary pressures. Financial conditions have tightened since the conflict began, which will help to reduce inflation over time. Taking all the risks to the economic outlook into account, the Committee judges that it is appropriate to maintain Bank Rate at this meeting."

David Hollingworth, associate director at broker L&C Mortgages, commented: "The threat of the rising cost of living has heightened market expectation that interest rates will have to rise or remain higher for longer – so, on the face of it, a hold should be good news for borrowers, and those that are on a variable rate will be relieved that they avoid any increase in their payments."

Experts say the base rate could remain higher for longer

Ben Thompson, of mortgage intermediary Mortgage Advice Bureau, said: "All eyes clearly will be on the anticipated impact of the Iran conflict on inflation and rightly so, as the last thing the UK wants now is a return to unmanageable climbing inflation and all its knock on negatives that prove hard to control.

"However whatever bumps and shocks come from this, all eyes will also be on low consumer confidence and a softer economic growth outlook. Most likely we will see current rates stay higher for longer and hopefully with no increases, followed by a series of cuts to get growth going as soon as the inflationary shocks can be seen to have passed through."

Nicolas Mendes, of mortgage broker John Charcol, said: "A hold should not be mistaken for a sign that the Bank is relaxed about the outlook. This is still a difficult backdrop, with inflation pressure picking up again while growth remains weak and the labour market shows signs of softening."

Brokers add that a hold doesn't mean mortgage rates will fall

Mr Mendes continued: "For mortgage borrowers, a hold does not automatically mean mortgage rates are about to fall. Fixed mortgage pricing is driven more by swap rates [which, oversimplifying greatly, are based on the market's view of long-term interest rates] and lender funding expectations than by Bank Rate alone. If markets still believe rates may need to move higher later in the year, lenders are likely to remain cautious.

"We may still see selective cuts where individual lenders want to compete, or where funding costs ease for a period, but borrowers should be careful not to read that as a sustained downward trend."

Mr Hollingworth said: "In recent weeks fixed rates have begun to ease back and there are still lenders feeding through improvements to fixed rates. Whether that will continue is far from guaranteed, as swap rates have edged higher amidst ongoing uncertainty.

"A wider margin between fixes and the initial rates on tracker deals has seen more borrowers betting on base rate only seeing a gentle increase, if it rises at all. Others will be hoping that fixed rates can improve further and are using a tracker with no early repayment charges as a holding position, allowing a switch to a fixed rate at a later date.

"Of course, if rates do climb it will push payments higher, so this strategy is likely to appeal to those with more flexibility in their monthly budget."

Need to remortgage? Look at your options sooner, brokers say

Aaron Strutt, of mortgage broker Trinity Financial, said: "The challenge is that the outlook remains finely balanced, so anyone coming to the end of a mortgage deal should look at their options early rather than waiting and hoping for a major fall in rates.

"While it is great to see fixed rate mortgages come down again, price hikes over the coming weeks can't be ruled out. The standard advice in uncertain economic times stands: secure a mortgage rate you think suits your circumstances or looks reasonable value for money as soon as you can, rather than try to switch to a cheaper deal with the lender before your mortgage is due to complete."

Mr Mendes added: "Anyone coming to the end of a fixed deal should look early, secure a rate where possible, and speak with a broker about the options available. In this kind of market, the better approach is often to lock in an affordable option and then keep it under review, rather than sit on the sidelines waiting for a clearer signal that may not arrive."

On your lender's SVR? You can likely save £1,000s with a new deal

A standard variable rate (SVR) is the rate you pay once your current mortgage deal comes to an end. SVRs have a variable rate of interest, which means the rate can change at any time.

SVRs are normally far more expensive than the best fixed or tracker deals – right now, a typical SVR is currently around 6% to 7%, but the top two- and five-year fixes start from circa 4.7% and 4.8% respectively. So if you're on an SVR, you should consider switching to a new deal now – see our Cheap mortgage finding guide.

Some savings rates have dropped – but you can still find a good deal

Since the base rate was last held at 3.75% in March, the top savings rates available on easy-access accounts have dropped slightly, so it's crucial to check your interest now. Millions are on pants rates, and can easily and simply move their money to where it pays more. If you're on a fix, diarise to act before it ends.

Half of UK savings accounts can beat the current 3.75% base rate, according to comparison site Moneyfacts.

Currently, the top easy-access rate is with Trading 212 paying newbies 4.51%. If you want a more established name, Chase pays 4.5% to newbies.

If you're worried about rates dropping and can lock money away, you might want to consider a fixed deal. Kent Reliance pays the top overall rate of 4.67%. However, if you're looking to lock-in with a big name MBNA, part of Lloyds Banking Group, pays the top rate of 4.66%.

For full info and lots more options, see our Top savings accounts guide.