The Bank of England's Monetary Policy Committee voted to keep the Bank Rate at 3.75% on 17 September. Six members supported holding the rate, while three members voted for an increase to 4%.
Despite the Bank Rate remaining unchanged, market interest rates have been increasing, which can affect borrowing costs for households and businesses. Quoted two-year fixed mortgage rates, for example, were approximately 0.95 percentage points higher than before the Middle East conflict.
For those with fixed-rate mortgages, the cost of a replacement deal when their current term expires may be higher than the original arrangement, even if the Bank Rate has not changed. This is because Bank Rate is one of several factors influencing lending rates.
Property owners approaching the end of a fixed mortgage deal may find it useful to assess their individual borrowing costs and how these fit with their property's income and expenses. A one percentage point change in interest can significantly reduce cashflow.