Will the Bank of England cut interest rates on 19 June?

With the Bank of England’s governor warning the path of interest rates in the UK has become more uncertain due to Trump’s tariffs war, we look at what’s predicted to happen when the Monetary Policy Committee makes its next announcement on the base rate on 19 June.

Post updated: June 4th, 2025

Will the Bank of England cut interest rates on 19 June?

The future path of UK interest rates has become more uncertain due to Donald Trump’s tariffs war, the Bank of England governor Andrew Bailey has warned.

When asked about the impact of the US president’s chaotic trade policy on the Bank’s policymaking by MPs on the Treasury Select Committee on 3 June, he said, ‘the path remains downwards, but how far and how quickly is now shrouded in a lot more uncertainty’, adding that a ‘gradual and careful’ approach to rate-cutting remained his ‘guiding light’.

Speaking in the aftermath of figures showing inflation jumped to 3.5% in April, Mr Bailey also said he continued to expect wage growth in the UK to decline in upcoming months, suggesting the Bank’s Monetary Policy Committee may feel more confident to cut rates.

‘I actually don’t think we’ve seen particular surprises in inflation outcomes relative to what we were expecting,’ said Governor Andrew Bailey. ‘The key question for me is we’ve got this view which is that we will see pay coming down this year. That’s going to be a crucial judgment going forward.’

Interest rates predictions

While mortgage holders welcomed the Bank of England’s decision to cut interest rates from 4.5% to 4.25% last month the chance of another interest rates cut this month is unlikely when the bank’s Monetary Policy Committee’s next meets on 19 June, experts warn.

While there’s a general consensus that interest rates are expected to be cut further this year, there’s differing opinion on when this will happen and how far rates will go:

  • Financial markets are pricing in around 2 further interest rates cuts this year with the base rate expected to fall to 3.75% by the end of the year. By comparison, in May, markets were pricing in three cuts.
  • Barclays has revised its interest rate forecasts following the higher-than-expected inflation data. It now no longer expects the Bank of England  to cut rates in June and now predicts the base rate will drop to 3.5% by February 2026, rather than by the end of 2025 as previously forecast.
  • Pantheon Macroeconomics now forecasts one more cut this year, down from two, because of ‘solid growth momentum, a fading uncertainty shock, inflation 1.5 percentage points above target and a slowing pace of disinflation.’
  • While Deutsche Bank is still expecting three more cuts in August, November and December, taking the base rate to 3.5% by the end of the year.
  • And Capital Economics, says it hasn’t changed its forecasts for two more cuts to 3.75% by the end of this year and one more in early 2026 to 3.50%. Although adding that it’s ‘perfectly possible that concerns over inflation and wages will prevent the Bank from cutting rates in August.’

Latest Bank of England base rate news

The Bank of England cut interest rates in May from 4.5% to 4.25%. This followed interest rates cuts in February 2025, November 2024 and August 2024, when the base rate was first cut from 5.25%.

However, the Bank’s nine-person Monetary Policy Committee was divided. While five members voted for the cut, two wanted a bigger cut to 4% while two voted for the rate to be held at 4.5%.

What are interest rates and why do they change?

The Bank of England’s base rate acts as a benchmark for the cost of borrowing money. As a general rule, when interest rates increase, so does the cost of borrowing on mortgages and other types of borrowing.

One major reason why the Bank moves rates up and down to help control inflation. When inflation is high, the bank may increase interest rates to try to bring it down by encouraging people to spend less and reduce demand. And once inflation is at or near its target, the Bank may hold or cut interest rates.

What’s happening with inflation?

Official figures released in May 2025 showed that the UK inflation rate increased by more than expected to 3.5% in the 12 months to April. This is 1.5 percentage points higher than the Bank’s inflation target of 2%.

When is the Bank of England’s Monetary Policy Committee’s next meeting?

The next Bank of England’s Monetary Policy Committee meeting is on 19 June 2025. Its subsequent meetings are on 7 August 2025 and 18 September 2025. The Bank of England publishes a calendar of future committee meeting dates here.

How do interest rates affect mortgages, loans and savings rates

How changes in interest rates affect your mortgage

Falling interest rates usually means mortgage rates fall too. Stay up to date with our guide to Mortgage rate predictions.

However, how changes in interest rates affect your mortgage depend on your circumstances:

  1. You’re taking out a new mortgage: If you’re shopping around for a new mortgage or want to remortgage, the mortgage rates available should improve if interest rates fall, although this isn’t guaranteed.
  2. If you’re on a fixed rate mortgage the amount you’ll pay on your monthly mortgage payments will stay the same during your initial term – usually 2 or 5 years. So your mortgage payments won’t change if interest rates go up or down.
  3. You have a tracker mortgages If you’re one of the estimated 600,000 households on a tracker mortgage deal and interest rates are cut, your mortgage payments will fall as the rate you pay on your mortgage rises and falls in line with the Bank of England base rate.
  4. If you’re on a discounted variable rate you’ll pay a rate that’s lower than the lender’s Standard Variable Rate. If your lender decides to pass on the cut in interest rates, your mortgage payments will fall. But it won’t necessarily pass on all or any of the cut.
  5. You’re on your lender’s Standard variable rate (SVR) According to UK Finance, there are around 1.1 million households on their lender’s standard variable rate. If this includes you, if your lender decides to reduce its SVR if interest rates fall, the amount you’ll pay will fall. But the lender may not pass on all or any of an interest rate cut. Lenders’ SVRs can be extremely expensive, so check your deal now to see if you can save by remortgaging.

Interest rate changes impact on credit cards and loans

Other types of borrowing are affected in a similar way. If interest rates go up, borrowing of any type generally gets more expensive, while when interest rates are cut, borrowing generally gets cheaper. However, this is in general terms as the amount you’ll pay on things like credit cards and loans will depends on a number of factors including your credit history.

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