The Bank of England meets eight times a year to set the base rate, a mechanism that influences interest rates on everything from mortgages to savings accounts.
The Bank’s next rate decision will be announced on 18 September. A cut currently looks unlikely at that meeting, with inflation on the rise.
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The Bank of England’s governor Andrew Bailey told the BBC that although the path for interest rates is still downwards, the course is now “a bit more uncertain”.
The MPC said medium-term inflationary risks have “moved slightly higher” since its last set of economic forecasts were published in May.
“The Bank of England thinks inflationary risks have picked up in recent months and as a result the gradual and careful approach to interest rate cuts still prevails,” said Laith Khalaf, head of investment analysis at investment platform AJ Bell.
“The fact there are so many hawks on the rate-setting committee will give markets pause for thought on how quickly interest rates will descend from here.”
Bank of England meeting dates
The MPC meets roughly every six weeks to set the base rate. The meetings usually happen the day before the interest rate announcement. There are three more meetings left this year:
- 18 September
- 6 November
- 18 December
What is the Bank of England’s Monetary Policy Committee?
The MPC is responsible for setting the base rate, also known as ‘Bank Rate’.
The base rate is the most important interest rate in the UK, as the interest you earn on your savings or that you repay on loans is influenced, set and adjusted based on this figure.
The committee is made up of nine members, chaired by governor Andrew Bailey. Four of the committee members are external experts, appointed to make sure the MPC benefits from thinking and expertise from outside of the Bank of England.
During each meeting, the committee votes on whether to cut, hold or raise interest rates.
Bank of England base rate forecast
Some economists have dialled back their predictions in response to August’s hawkish voting split. Deutsche Bank is one example.
Before August’s meeting, the investment bank was forecasting two cuts in the final quarter of 2025, coming in both November and December. It has now revised this to just one.
Deutsche Bank still thinks rates will ultimately settle at 3.25%, but not until the second quarter of 2026 rather than the first.
Financial institution ING is sticking to its original call. It thinks we will see one more cut this year, coming in November, and two more in 2026.
Advisory firm Oxford Economics also thinks the MPC will cut rates in November this year, but this call comes with “much less confidence” than before.
Research firm Pantheon Macroeconomics doesn’t think we will see any further cuts in 2025.
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