“There is still an appetite to lend though, and we are hopeful that in the absence of any rate increases, borrowers will continue to transact.”
Meanwhile Paul Noble, CEO of Chetwood Bank, says: “I don’t think anyone believes today’s result means rates will stay at their current level for long. The MPC might be getting mixed signals from the economy, but it feels like there’s a general sense that it’s only a matter of time before we see another cut.
“That expectation is already feeding into pricing, particularly at the short end of the market. Whilst we’re seeing savings rates gently ease back as the market anticipates lower bank rates later this year, longer-term borrowing costs, including mortgage pricing, remain influenced by where longer-dated swap rates settle. These have been more resilient.
“Falling swap rates will mean we almost certainly see rates go down across the entire savings space in the coming weeks, which means smart savers will look to lock down the best fixed-rate deals while they’re still high. Across the board, savers need to be alert and make sure they’re making the most of their money, particularly any funds left in low- or no-interest accounts when they could be making more of a difference.”
We’ll bring you more lender, broker and economist reactions as the day continues.