Latest Bank Rate predictions: stuck below 0.5% until 2021

The victory of Donald Trump in the US presidential election has changed the interest rate landscape, and events in the US have significant potential to influence savings and mortgage rates in Britain. This article will be updated shortly to reflect these events.

At the start of the year, the expectation had been for Bank Rate to rise in December 2016 or January 2017. America’s central bank had just ordered the first rate rise for nine years and Britain wasn’t expected to be far behind.

But fresh global economic gloom in 2016 and repeated “dovish” comments from the Bank of England dramatically changed the position. Expectations for the first rate rise shifted from later this year to 2020 within a matter of months, although they later moderated a little.

But now, following the referendum, Bank Rate has been halved to 0.25%, the first move in more than seven years.

Although the Bank Rate cut was expected in the wake of the Brexit vote, it has changed rate predictions. The markets now expect the rate to drop to 0.1% and remain below 0.25% until late 2019 or 2020, not making it back past 0.5% until 2021.

Contact our advisers today on 01202 937444 or visit our other websites to speak to a mortgage broker in Reading or a mortgage broker in Bournemouth