Overview

• The Bank of England reduced its base interest rate by 0.25 percentage points to 4.25%, its lowest level in two years, citing easing inflation pressures.
• UK lenders, including Nationwide, Halifax, Virgin Money, and TSB, responded by lowering mortgage rates, offering significant savings for borrowers.
• Tracker mortgage holders in the UK are set to save nearly £350 annually, while standard variable rate borrowers could save about £170 per year.
• In contrast, the Federal Reserve maintained its federal funds rate at 4.25–4.50% for the third consecutive meeting, leaving US mortgage rates unchanged at an average of 6.76%.
• Economists predict further UK rate cuts in 2025, while the Fed remains cautious, awaiting more economic data before considering policy changes.