BSA comments on the MPC's decision to keep the Bank Rate at 5.25%
Commenting on the MPC’s decision not to change the Bank Rate from 5.25%, Andrew Gall, Head of Savings and Economics at the BSA said:
“Today’s decision to keep the Bank Rate at 5.25% will be welcome news for many.
“Whilst we can’t yet be confident that mortgage rates have reached their peak, we have started to see them nudge down a little and today’s news is unlikely to reverse that. However, while inflation remains persistently high, overall rates will stay higher for longer than we thought earlier in the year.
“The number of borrowers struggling to maintain their mortgage payments has started to increase. Whilst building societies’ lower risk approach to lending decisions means they have proportionately fewer loans in arrears compared to banks, there is no room for complacency. Societies are conscious that it is a real worry for families and individuals who are having difficulty meeting their mortgage payments. They are ready and well equipped to offer practical, tailored support to anyone who may be struggling and I would encourage anyone with concerns to contact them as soon as possible, preferably before they miss any payments.
“For savers, there remains a wide choice of accounts with attractive rates available for all levels of deposit. Shopping around can now make a sizeable, financial difference, particularly for those who hold most of their savings in their current account. There is currently £260 billion of savings in accounts not earning any interest, meaning an average saver could be missing out on over £1,0001 extra income a year.”
1. Based on mean balance of £21,841 earning the current best-buy easy access account rate of 5.2% (Source: https://moneyfactscompare.co.uk/savings-accounts/easy-access-savings-accounts/ Moneyfacts 1 November 2023) for a year compared to no interest in a current account.