Martin Lewis issues 'snap verdict' on Bank of England base rate cut

James Rodger
·2-min read
Sounds podcast host and ITV star spoke out on Twitter, now X, over a change for those who are paying off a mortgage or who have savings.
-Credit: (Image: Reach Publishing Services Limited)


Martin Lewis has issued his "snap verdict" on the Bank of England base rate cut today. The BBC Sounds podcast host and ITV star spoke out on Twitter, now X, over a change for those who are paying off a mortgage or who have savings.

Mr Lewis said: "UK Bank of England Base rate DOWN 0.25% points to 4.75%. What it means for mortgages and savings. Mortgages: Tracker rates will get cheaper by roughly £25 a month per £100,000 (variable and discount rates should drop too but don't have to go by the same amount).

"Your fixed rate mortgage will not change. Though the rate you can fix at may get cheaper (although as they're based on predictions of future interest rates some of this cut is already baked in). Savings: Easy access rates are usually variable, so both cash ISAs and normal savings, will likely drop by around 0.25% points, though as it's competitive at the top, some of the best may leave it a little later to drop.

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"Your fixed rate savings will not change. Though the rate you can fix at may be reduced (although as they're based on predictions of future interest rates some of this cut is already baked in)." The base rate has been cut to 4.75% from 5% by the Bank of England.

This rate is used by the central bank to charge other banks and lenders when they borrow money, so the move can impact mortgage and savings rates. Editor-in-chief of TopMoneyCompare , Russell Gous said: "The Bank of England's decision to reduce the base rate to 4.75% comes as no surprise, despite concerns from the OBR that last week’s budget could push inflation up in the short term.

"However, while inflation remains a concern, the decision signals an acknowledgement that high borrowing costs are weighing on economic momentum. The trade off may be a delay in further cuts previously expected to come in December. For the exchange markets, this rate cut could contribute to further fluctuations in sterling. GBP has stabilised against the Dollar since the US election result was announced, and as today’s cut has been widely priced in, the impact should be muted.

"For individuals and businesses making international transfers or significant overseas purchases, it’s still well worth keeping a close eye crucial to keep a close eye on GBP movements in the coming days.”

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