“As expected, the Bank has kept its powder dry on any movement on rates,” Harry Arnold of Anderson Harris told MI’s Bryony Garlick. “The situation in Iran is at this stage too unpredictable for the Bank to make a call on whether to increase rates. They will leave the door open to hikes over the summer when more postwar economic data is released and base decisions on that.”
But some say the Bank of England is just putting off difficult decisions that lie ahead.
“The Bank of England is kicking the can down the road, but households can’t afford to do the same,” said Alex Beavis, interim director of retail banking at LHV Bank. “While households are counting the cost already in terms of higher fuel costs, there will likely be a further knock-on impact in the months ahead as those raised energy costs feed into the price we pay for other items, such as food.”
Beavis sees at least one base rate hike this year as “inevitable”.
For north London real estate agent and former RICS residential chairman Jeremy Leaf, today’s announcement doesn’t look set to move the needle much for the housing sector. “As far as the impact on the property market is concerned, the effects are likely to be fairly minimal,” he said, “although encouragingly, we have noticed some mortgage costs starting to creep down again. This will certainly help to improve confidence, which remains at a relatively low ebb.”
