Interest rates hold steady but will mortgage rates?
The BoE holding the base rate at 0.5% is unlikely to influence lenders mortgage rates.
For a 39th month the base rate has been held at its historic low but as Deal Direct have reported on many occasions, the base rate currently has little influence on the setting of UK mortgage rates.
The BoE monetary policy committee has also taken the decision not to increase its programme of quantitative easing which will be held at £325 billion.
The BoE voted in February to increase its quantitative easing programme by £50 billion to £325 billion, but in the last MPC meeting 9 out of 10 members voted for no further increase.
However at this point in time the base rate has less influence on the setting of mortgage rates. Following swap rates for the setting of fixed rates and the Libor for tracker rates, should provide a better indication of what lenders are likely to do and which direction mortgage rates are likely to move.
Swap rates are falling which should influence fixed mortgage rates but home-owners will have to wait and see if their rates will fall as a result.
Some lenders are marginally reducing their fixed rates, Barclays, Nationwide and Abbey have all made rate cut announcements of between 0.1% and 0.3%.
However with lenders blaming a reduction in mortgage lending levels and an increase in rates on rising funding costs, it is unknown how many more lenders will follow suit.
If you are looking for the most competitive mortgage rates on offer contact Deal Direct.
