Bank of England Announces Decision to Hold the Base Rate

Madhu Kejriwal, CEO at TransUnion in the UK, comments on the Bank of England's decision to hold the base rate:

"The Bank of England’s decision to hold the base rate at 3.75% is unsurprising, despite expectations of a cut only a few weeks ago. For households this means borrowing costs stay where they are for now, although it is worth noting that many lenders had already increased their mortgage rates. With energy prices still volatile due to the current geopolitical climate, there is a short-term inflation risk. The overall cost of living will remain a point of concern for many households as price increases will likely filter through the economy for the remainder of the year and into 2027.

“The better news for consumers is that stabilising measures should help soften the blow: Ofgem's energy price cap will fall by 7% from April 1st and HMRC has extended the 5p-per-litre fuel duty cut until the end of August, which should help to offset some of the energy price increases that consumers are set to face.

"Unfortunately, consumer confidence is likely to be impacted, affecting spending behaviours and personal finances. It is important that consumers are actively managing their personal finances: reviewing fixed and variable commitments, checking their credit reports regularly and utilising competitive savings rates while they remain higher. With lenders repricing their mortgage offers, people nearing the end of fixed terms should keep a close eye on the market to find the right deal. Staying vigilant against scams, particularly those mimicking lenders or energy providers, is equally important in periods of uncertainty. Strong credit habits and timely shopping around will help households navigate what may remain a bumpy few months."