Target's comment on the Bank of England's base rate decision

19 December 2024

Melanie Spencer, sales and growth lead at Target Group, said: “A hold was always the expected outcome of this latest meeting, especially given the recent news on inflation. While the uncertain outlook for inflation will remain a worry for the Bank of England, the overriding feeling is that we will still see a return to cuts in 2025.

“It will be interesting to see how swap rates react to this stability and whether it provides lenders with the scope to make even small changes to pricing. We have seen some movement in recent weeks as swaps continue to stabilise post-Budget and the hope for many is that this trend will continue into Q1, with a potential cut in February’s meeting.

“With the change to stamp duty relief coming at the end of Q1, this is likely to encourage activity in the early part of the year – although with transaction times as they are, it is likely that many will have already missed the boat. However, with consumer demand expected to increase as rates and market conditions improve, there’s no question that technology adoption and integration will need to play a key role – whether that’s driving efficiencies in application and decision-making, or bringing product or criteria innovations that help answer the demands of the market.”