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Yesterday was once again the monthly meeting for the Bank of England’s Monetary Policy Committee (MPC), the group which decides, amongst other things, what the base rate of interest will be set at for the following month.

Each month, a large number of home owners await the decision whilst keeping their fingers crossed, hoping that they might get a reduction in the cost of their mortgage or home loan and praying that it won’t go up due a rate rise.

Well once again these people can breathe a slight sigh of relief as the MPC voted to maintain the status quo and keep interest rates unchanged at 5.0 per cent. The decision comes as no surprise to experts, who had already predicted that rates would stay the same. The last rate reduction was in April this year and further cuts, which would help the housing market and those individuals with loans and mortgages, have had to be postponed due to upwards pressure from rising inflation rates. In the US, the Federal Reserve also made the decision to keep their base rate the same at 2.0 per cent.

We do not know as yet how the voting in the MPC’s meeting went, as the minutes are not published until later in the month, but last month the committee was split, with some members calling for a rate cut to help those with loans and mortgages, some calling for a rise in order to curb inflation, whilst the majority vote was to leave rates as they were previously.

Michael Coogan of the Council of Mortgage Lenders said “Holding the Bank rate is better than raising rates, as one MPC member suggested last month, but a reduction would have been a welcome recognition of the current financial strains on households already struggling with hikes in other living costs.”

As the slowdown in the UK economy continues, this should ease the current pressure on inflation and once this returns to reasonable levels, we are likely to see renewed demands for an interest rate cut to help the loan and mortgage market, not only from borrowers, but from lenders also.