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Mortgage rates in the UK are poised to drop as uncertainty surrounding US President Donald Trump’s trade tariffs has sparked expectations that the Bank of England could cut interest rates more aggressively this year.
Financial markets and economists previously anticipated two interest rate cuts this year, but due to increased economic uncertainty driven by tariff-related concerns, economists now predict the Bank of England could cut rates at least three times by the end of the year. The Bank’s current base rate stands at 4.5%.
TSB Bank has already confirmed it will cut certain two-year fixed mortgage rates by up to 0.25 percentage points, with MPowered Mortgages also reducing their rates. Industry analysts forecast other lenders will soon follow, resulting in potentially significant savings for borrowers.
Mortgage experts highlight that lenders are beginning to factor in these future rate cuts, which could lead to attractive deals appearing imminently. According to financial data firm Moneyfacts, although average rates for two- and five-year fixed deals currently remain around 5.32% and 5.17% respectively, these figures are expected to decrease notably in the coming weeks. Sone analysts have suggested mortgage rates may even dip below 4% if market conditions persist.
Act Now on Rate Reductions
This current situation presents a timely opportunity for homeowners whose fixed-rate mortgage terms are nearing expiration, particularly those whose agreements were set before interest rates started rising in mid-2021.
Data from the Financial Conduct Authority shows approximately 1.3 million homeowners have fixed-rate deals ending between April and December, potentially positioning them to benefit from this downward trend.
Build Rapport With Our Team
If you’re contemplating buying a property, switching products or re-financing to a lower rate this is an ideal time to book a call in with our award winning team.
Building rapport and giving us an opportunity to fully understand your circumstances means we can act quickly to help when a suitable opportunity arises for you.
Contact us today to discuss how we can assist you on 0208 364 3444 or click here to schedule a free consultation call.