Mortgage customers across the UK will welcome the decision by the MPC to finally reduce base rate this lunchtime.
The quarter point cut was by no means certain, but is seen as the first step in reducing home loan costs for UK borrowers to a more affordable level.
The long awaited rate cut is the first since March 2020 and only the third reduction in the last 8 years.
Many consumers continue to struggle to make ends meet, so this move will be a welcome relief to mortgage holders on a variable rate.
For those currently on a fixed rate home loan, the financial benefit won’t be felt immediately but it should make life a little less painful when they next come to review their fixed deal.
People will be hoping this is the first of a series of cuts in the next 6-12 months, especially as inflation appears to be back under control.
As always, interest rate moves are a double edged sword, while mortgage borrowers will be uttering a collective sigh of relief, UK savers know that rates will start heading south, so if you’re undecided what to do with your savings balance, now could be a good time to lock into a decent rate while they are still available.
