Deutsche Bank’s chief UK economist, Sanjay Raja, has dived into the numbers and reasons beyond the votes on interest rates and QT.

There are a few findings worth discussing, he says – including a suggestion that a late-year interest rate cut is still on the table.

“With a 7-2 vote tally, one thing is clear: the MPC remains fractured,” he said.

“The MPC also reiterated that monetary policy was not on a pre-set path – and the MPC ‘would remain responsive to the accumulation of evidence’. Put simply, a Q4-25 rate cut remains very much on the table with the MPC doing little to shift market expectations one way or another.

“We continue to see one more rate cut to end the year (December). And we continue to think that Bank Rate will settle closer to 3.25% ahead of next summer.”

That’s three cuts between now and next summer – considerably higher level of reductions than other analysts are forecasting at this time.

The remaining 2025 meetings of the BoE’s MPC are:

Many experts are suggesting we won’t get a rate cut below 4% before the year is out – but not everybody agrees.

And the bigger point to that is, economic data will determine whether we see one – and that can change very quickly.

Job market data, unemployment rates, wage growth, tariffs impact, inflation and of course – in the case of the December meet – the Budget will all impact each other in different ways to determine when the next cut comes (or rise, indeed).

Here’s what the experts are saying today…

Ed Monk, pensions and investment specialist at Fidelity International:

“The pathway to lower rates in the UK appears to be getting narrower, with rates held today and just one more rate cut now being priced in before 2027.

“The gilt market is indicating that no further rate cuts are likely this year, with the MPC meeting in March 2026 currently looking most likely to bring the next reduction.”

Peter Stimson, director of mortgages at MPowered:

“With two members of the committee voting for an immediate rate cut, the prospect of a cut in November is still firmly on the table. But nevertheless the Bank is allowing itself plenty of wriggle room, and it’s more than possible that we won’t see another base rate cut until 2026.

“The mortgage swaps market, which is used by mortgage lenders to determine the fixed interest rates they offer to borrowers, still suggests there will be two more base rate cuts in total, albeit with the timescale stretching into the new year.”

Rob Morgan, Chief Investment Analyst at Charles Stanley:

“While core goods inflation may be peaking, services could remain sticky due to elevated employment costs. This could keep overall CPI high, even as other components stabilise. Food prices also represent a major worry and could continue to drive consumer expectations.

“The Autumn Budget adds a further layer of complexity. Until there’s clarity on the Chancellor’s fiscal plans, the MPC may be reluctant to ease further. That makes a November rate cut unlikely. December’s meeting could be more finely balanced, depending on incoming inflation data and the Budget’s implications, but it’s likely the next rate cut won’t arrive until 2026.”

The British Chambers of Commerce (BCC) has warned that higher interest rates mean greater cost pressures for businesses – and says the government has to break the cycle with the Budget.

“A further hold aligns with the BCC’s latest forecast, which expects no further cuts this year,” said David Bharier, head of research.

“Global factors such as tariffs, conflicts, and fragile supply chains, alongside domestic pressures – higher taxes and uncertainty ahead of the Budget – are clouding the outlook.

“SMEs are wading through a swamp of rising business costs which is impacting on confidence, investment and recruitment. Our latest survey shows that 73% cite labour costs as the top pressure, driven by the increase to employer NICs.

“Breaking this cycle depends on boosting growth, exports and productivity – not further burdens on firms. The Chancellor will need to use the November Budget to support business investment and confidence, not undermine it with new taxes.”

Most experts seem to be wavering between nodding approval at the BoE slowing QT rates, and marginal frustration at it not going further.

The Institute For Public Policy Research (IPPR) suggests that the Bank could have stopped sales altogether.

“The Bank was right to slow the unwinding of its economic support programme – quantitative tightening. It has added unnecessary pressure on gilt yields at a time of global pressures. The Bank should have in fact gone further and fully stopped active gilt sales, as these are not needed for its monetary policy strategy,” said the IPPR’s Carsten Jung, who is in fact a former BoE economist.

“Meanwhile, the expected inflation bump over the summer is projected to ease and the Bank of England should more strongly signal how it intends to lower rates over the coming months, given a range of factors pointing to weaker demand.”

As is to be expected, the political discourse has begun with typical point-scoring.

Here at Independent Money we’re more concerned with telling you how these decisions affect you day to day than with the blame-gaming, but for completeness…

Sir Mel Stride MP, shadow chancellor, said:

“The fact interest rates are not coming down faster is a result of Labour’s reckless decisions which have pushed up inflation.

“The Prime Minister and Chancellor are distracted by scandal and working people are paying the price.

“There is deep nervousness about the drumbeat of bad economic news: inflation doubled, growth flatlining, and 150,000 jobs lost since the Budget.

“Only the Conservatives, under new leadership, will deliver a stronger economy.”

One key issue which the BoE has given information on today is that of quantitative tightening.

In a quick nutshell, the bank buys government bonds during spells when required, then sells them again afterwards – but had faced criticism recently due to the pace of sales, which pushed prices down and yields (government borrowing costs) up.

Ultimately, it has voted to reduce the rate of sale of them for the coming 12 months.

More on that to come – the vote to do so was split.

On the flip side to mortgages, as ever, are savings.

When interest rates remain higher you can get a better rate on your cash – and it’s important you seek the best returns possible right now, with inflation running close to 4%.

“Inflation is a ‘Jekyll and Hyde’ character – while it may be good news for borrowers, as it erodes the value of their debts, it has detrimental implications for savers, investors and for retirees, chipping away at the value of future income payments and eroding the worth of their original capital pot,” explained Maike Currie, VP Personal Finance at PensionBee.

There are still plenty of places you can get above 4% on your money, so make sure you move your savings if needed.

Reaction pouring in already – we’ll bring you the best plus what the BoE itself says in reaction.

As anticipated, the first port of call for many will be over their mortgage repayments.

If you’re on a fixed-term deal nothing changes, but those on variable rates could have – and the many thousands preparing to get new deals across the rest of 2025 may have been hoping for more interest rate cuts.

Jasmin Ehlert, head of bank analytics at Raisin UK, says that’s not happening any time soon – so move quick before banks push up their terms even higher.

“Today’s decision by the Bank of England to hold the base rate at 4.00% reflects the difficult balancing act it faces,” she said.

“For households, this means mortgage and loan costs will not fall straight away, though lenders may start to sharpen their offers if economic pressures build and rate expectations shift. Anyone considering a fixed-rate mortgage should be ready to move quickly when a competitive deal becomes available.”