Bank of England announces an interest rate hold at 3.75%: how does this impact your money
Today, 19 March 2026, the Bank of England (BoE) announced a base rate hold, keeping the figure at 3.75%. Discover how this could impact your money, including what it means for your mortgage, savings, and annuities.
In today’s announcement, the BoE stated the base rate will remain unchanged at 3.75%.
While a cut was expected, recent global conflicts have reversed forecasts, making a cut increasingly unlikely this year.
This base rate hold may impact your finances, especially if you have a mortgage, are nearing retirement, or wish to grow your money.
The BoE base rate will remain unchanged at 3.75%.
The members of the BoE's Monetary Policy Committee (MPC) unanimously voted to keep the base rate at 3.75%.
This is the second hold this year, following February’s announcement. The rate was initially cut to 3.75% back in December 2025.
While many expected a rate cut during this March meeting, the recent US-Israel war on Iran and the subsequent unrest in the Middle East have led to a reversal of forecasts.
While some had said the markets were pricing in one or two cuts in 2026, investors now expect the BoE will keep the base rate at 3.75% for the rest of the year as they monitor the conflict and its impact. This means it is unlikely to be a rate cut in 2026.
The current inflation rate is 3%, while the BoE target is 2%.
How does a held base rate affect mortgages?
Following the BoE’s announcement, those with variable-rate mortgages can expect their rates to remain unchanged.
For those on fixed-rate mortgages, no changes will occur until their current term concludes. Data from Rightmove shows that the average five-year fixed-rate mortgage is 4.86%, and the average two-year fixed-rate mortgage is 4.76%.
The cost of homeownership is at an all-time high, with mortgage rates higher than at any time in the past.
If you are applying for a mortgage, you will need to meet several requirements. These include demonstrating that you can afford the repayments, possessing a healthy credit score, and settling any unpaid debts.
A qualified mortgage broker can increase the likelihood of your application being approved.
What impact does a hold have on savings?
Even though savings rates have fallen from their recent high of 6%, the majority still offer returns above inflation.
According to MoneySavingExpert, here are some of the most competitive rates available for various kinds of savings accounts:
Easy-access savings accounts: 4.68%
Fixed term accounts (one year): 4.36%
Notice savings: 4.08%
If you’re seeking higher returns and don't require immediate access to your funds, investing is a viable alternative.
Although this can result in greater profits, it also carries a higher level of risk.
If you do decide to invest, getting professional advice is beneficial.
Unbiased can connect you with a qualified financial adviser who can assist you in developing an investment strategy, evaluating your portfolio, or advising you on ways to legally reduce your tax obligations.
What does it mean for annuities?
An annuity is a financial product, usually bought with pension funds, that provides a guaranteed income for either a set duration or for the remainder of your life.
Since the base rate directly affects annuity rates, they are subject to constant fluctuations. In 2025, annuity rates have increased by almost 10%. However, once you secure an annuity, your rate will be fixed.
Unbiased can match you with a financial adviser who can assist you in selecting the most suitable annuity for your personal situation.
Get expert financial advice
Regardless of your financial objectives, whether you are searching for a mortgage, expanding your investment portfolio, or saving for retirement, expert financial advice can be invaluable.
Unbiased can seamlessly connect you with a professional who can empower you to make the most informed decisions to achieve your goals.
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