What happened
The Bank of England held its base interest rate at 3.75 percent at its June meeting. Seven members of the Monetary Policy Committee voted to keep rates on hold, while two wanted a rise of 0.25 percentage points as they worried about inflation creeping back up.
Why it matters
The base rate sets the cost of borrowing across the economy, from mortgages to business loans. Holding steady signals that the Bank is not yet confident enough about falling inflation to start cutting, even though many economists expect a reduction to 3.5 percent by the end of the year.
Explained simply
Think of the base rate as the thermostat for the whole economy. Turn it up and spending cools down, turn it down and activity heats up. Right now the Bank is keeping its hand on the dial, watching to see whether rising energy prices push the temperature back up before it decides to cool things further.
What it means for you
If you have a tracker mortgage, your payments will not change this month. Savers can still find fixed accounts near current levels, so locking in a competitive rate now may be wise before any cut later in the year trims what banks offer.
