Interest rates held at 5.25%

22 Sep 2023

UK interest rates have been left unchanged at 5.25% by the Bank of England's Monetary Policy Committee (MPC).

The MPC had previously raised rates 14 times in a row to tame inflation, leading to increases in mortgage payments but also higher savings rates.

However, the latest move raises the prospect that this cycle of rate increases may have peaked.

Martin McTague, National Chair of the Federation of Small Businesses (FSB), said: 'Small firms will be profoundly grateful to hear that the relentless upward march of the base rate has finally paused. Now the hope is that the peak has been reached and passed, and that – in due course – rates begin to fall.

'It's been a long slog to get to this point, and many small firms have suffered financially along the way, with margins and cash reserves battered by both the phenomenon the Bank tried to control, inflation and the 'cure' it applied in the form of fourteen consecutive rises in the base rate, leading to higher borrowing costs and dampened consumer demand.'