Sunita Somvanshi
The Bank of England kept its base rate at 3.75% on September 17, 2026 — but the vote was not unanimous, and the decision leaves the direction of UK interest rates genuinely uncertain ahead of November.
The Monetary Policy Committee voted 6 to 3 to hold. Three members wanted the rate raised to 4%. UK inflation reached 3.1% in August. The next scheduled decision is November 5.
The Bank of England’s Monetary Policy Committee voted 6–3 to maintain the Bank Rate at 3.75%. The three dissenting members backed a rise to 4%. UK Consumer Prices Index inflation came in at 3.1% in August 2026 — above the Bank’s 2% target.
The Bank also confirmed a multi-year quantitative tightening plan: according to the Bank’s stated plan, the remaining stock of government bonds purchased under quantitative easing will be reduced at an annual average pace of £46 billion through 2034. Two-year fixed mortgage rates were running around 95 basis points higher than before the Middle East conflict, according to Bank of England data.
What the decision means for mortgages and savings
Holding at 3.75% means no immediate change to the central policy rate. But that does not mean household borrowing costs stay fixed. Mortgage lenders price their products using broader financial market conditions, not the Bank Rate alone — so what lenders charge can move even when the base rate does not. The 6–3 vote, with three members backing a rise to 4%, signals that the MPC is split on the direction of travel.
For savers, the distinction between the Bank Rate and actual savings rates matters. High-street banks do not automatically pass on the full Bank Rate to savings products. The current 3.75% rate is the policy reference point; the interest you earn depends on what your individual bank or building society actually offers.
Mortgage holders on tracker products — those directly tied to the Bank Rate — will see no change from this decision. Fixed-rate borrowers are unaffected until their deal ends. Anyone coming off a fixed rate and renewing now needs to compare current product rates, which reflect both the Bank Rate and wider market conditions.
Inflation at 3.1% remains above the Bank’s 2% target. The MPC’s mandate is to return inflation to that level, and the 6–3 split suggests the committee is not settled on whether holding rates will achieve it — three members clearly judged a higher rate was needed immediately. The November decision will depend on how inflation, energy prices and the wider economic outlook develop.
For context on how UK rates affect household finances, see UK mortgage rates and what they mean for you, UK inflation and cost of living tracker, and Bank of England previous rate decisions.
What is the Bank of England base rate now?
The Bank Rate is 3.75% following the September 17, 2026 decision. The MPC voted 6–3 to hold, with three members backing a rise to 4%. UK CPI inflation was 3.1% in August. The next scheduled decision is November 5, 2026. The split vote signals division within the committee on whether current rates will bring inflation back to the 2% target. Check back after the November 5 decision for the next rate update.
