Interest rates in the United Kingdom maintain steady at 4.25%
Welcome back, dear reader! We've just wrapped up our coverage on interest rates and here are some interesting dates and facts for you to mark on your calendar.
MPC Meeting Dates in 2025
- 7 August
- 18 September
- 6 November
- 18 December
Economists are casting their votes on the number of rate cuts we can expect for these meetings.
Some Are Bearish, Some Are Bullish
Research provider Pantheon Macroeconomics backs a single cut, potentially coming in August. On the other hand, financial institution ING is confident about two more cuts, coming in August and November. Deutsche Bank is a bit more bullish and anticipates three rate cuts, with the pace of policy easing picking up later in the year if pay growth continues to slide. It's quite fascinating to see the diversity of opinions mudding the waters!
Is the UK Economy Heading towards Stagflation?
With high inflation rates, restrictive interest rates, and slowing economic growth, some have raised concerns about a potential stagflation situation. However, the Bank of England has asserted that the inflation rebound is short-lived and will peak at around 3.7% in September before residing.
Struggling to Keep up with Those Savings?
Savings rates have been steadily dropping due to the rate cuts and analysts foresee that the top savings deals will continue to disappear over the coming months. If you're tired of losing money on savings, shopping around for inflation-busting rates might be the best solution. The top accounts offer up to 5% AER, but read the terms and conditions carefully as some of the most attractive deals include a temporary bonus rate.
Wrap Up!
Don't forget to lock in those fixed-rate savings accounts if you have some money to spare! With potential rate cuts on the horizon, you won't want to miss this opportunity. We'll be back soon, exploring more on savings and the impact of interest rate decisions on your personal finances. In the meantime, let us know your thoughts!- Are you looking forward to more rate cuts?- Are you a prospective homeowner concerned about the impact of rate cuts on mortgage rates?- Do you have significant savings and are enjoying higher returns? Share your thoughts in our poll!
Stay tuned for more updates as the Bank of England carries on with its Monetary Policy Committee meetings. Keep calm and save on! 💸📈
- In the context of personal finance, analysts predict that savings rates will continue to drop due to upcoming interest rate cuts, and suggest shopping for inflation-busting savings accounts that offer up to 5% AER, though some attractive deals may include a temporary bonus rate.
- Despite diverse opinions among economists about the number of rate cuts at upcoming MPC meetings, research provider Pantheon Macroeconmicss anticipates a single cut potentially in August, while financial institution ING foresees two cuts, in August and November, and Deutsche Bank is more optimistic with three predicted rate cuts later in the year.
- While the Bank of England has stated that inflation will peak at around 3.7% in September and then decrease, concerns have been raised about a potential stagflation situation given high inflation rates, restrictive interest rates, and slowing economic growth.
- As the banking and insurance industry navigates through rate cuts, it may become challenging for the UK economy, particularly for those relying on pension income, as gold tends to be a popular hedge against inflation and slow economic growth.
