Interest Rates WON’T Be Cut — What It Means For Mortgages & Savings

Added: 2026-04-29

[00:00:00]Hey, my name's Joe Nicholson. Welcome to my YouTube channel. It's a big week with the Bank of England this week. You see, they've got their meeting, their monthly meeting on interest rates, and this meeting is all over the place really because we should have had a rate cut in March. That was the expectation.

[00:00:21]Then we got about of Trumpflation. We've got a war started in the Middle East.

[00:00:26]We've got energy costs going up on a regular basis. You feel like they're going down, then they're back up. And this is going to hit the UK inflation data. And so this puts the Bank of England in a difficult spot. You see, inflation was going to hit below 2% by now, but because of the Iran war, we're already back above 3.3% with the expectation that we're going above 4% by the end of the year. In this video, I'm going to give you an update on what to expect if you're a borrower or someone that has a mortgage with this week's Bank of England meeting. But before we do jump into that, if you are new around here and you haven't done already, please do subscribe to the channel over there and hit that bell notification. Join over 54,000 subscribers who get all the latest property news, house price news, interest rate news, property investing tips, and much much more. And help me get some views on this video. Your part in that is simple. All you need to do is smash like, tick or like, do something to that like button. That really helps with the YouTube algorithm and that really does help the channel grow. So, thanks to everyone that does that. So, what a crazy week this will be. The Bank of England, they must be frustrated because they want rates to come down, I believe. Um, but they won't take action until they see a clear path of inflation going down. Now, I think that's wrong because I think we've got bigger problems uh all around the world at the moment. I think that you've got a massive threat from AI. I mean, I use AI in my marketing agency every single day.

[00:02:09]I was using ChatgPT for a year or so and now I use this one called Claude and it's insane the productivity that it can give me. It's like having people working for you now. Whereas chatgpt before write a few things in there, write a little article for me or do a little bit of graphic design, now with claude, it actually controls your computer and does the work for you. Uh, and so that is going to hit employment in the UK for sure. This week, just in the last week, Microsoft has cut 10% of their workforce. Facebook has cut 10% of their workforce. In fact, Facebook are forcing their employees to have some sort of widget on their computer that looks at what they do. And so, it trains the AI to basically replace their job in the future, which is crazy. Uh, if you think about it, uh, what do you do in that sort of situation? But look, major major companies are getting rid of people because of AI and automation. That means unemployment is going to go up at some point. Now in the UK this week, unemployment did just go down. It did the opposite, but that's because people are desperate. They're taking jobs that maybe they didn't want or didn't need uh because they want some income uh at the moment and they're worried about things going forward. Uh and so the Bank of England has to look at a few things.

[00:03:42]They're looking at maximum employment.

[00:03:45]So, it's difficult because the unemployment's just dropped. Uh, so that doesn't really help us with a rate cut here. And they want to keep inflation under control and that's just gone up.

[00:03:56]Now, when this war started, the mortgage rate data went all over the place. So, lenders, they borrow on something called the Somnia SWAT rate. That went up around 1% in a week or so. And then lenders increased their rates to us over a two-week period by 1%. Uh now the Bank of England didn't increase rates at all, but the markets were saying at that point that the Bank of England would increase rates four times, four times in 2026. They didn't. And the expectation now is that they might increase just once, which I think would be a mistake because the economy is so close to being in a recession constantly. I think we need to do something to stimulate the economy and actually get it going. So, the Bank of England's rate currently sits at 3.75%.

[00:04:55]And I believe this week, and so do the markets, that they will hold. I don't think that they will go up. They're definitely not going to go down. I think that they will hold. And their meeting, the press conference will be all about how they had to hold because they needed to see what was going to happen with the market. Because look, this war is so unpredictable. Normally, you would have a lot more of an idea on what would happen. Right now there's a ceasefire that just keeps getting extended. Iran says they're not in negotiations. Trump says they are every few days and it's looking like it's to manipulate the markets. Uh and so that's what we want to see. Like does this war end in a week or so? If it does then inflation might start coming back down. It's not going to come down quickly. It will take months for this to to filter through.

[00:05:54]But if it does stop, then they do have the opportunity at least to not do an interest rate increase at some point this year. So for borrowers, this is bad. Borrowers want interest rates to go up because they get a better return on their money. That's not likely to happen this month. Now, there are nine members in the monetary policy committee and I think all nine will vote to hold this time. I think no one will vote uh to decrease for sure. I think you'll get a straight nine that will say let's hold rates and see what happens. So the inflation data is something they're going to keep an eye on. So inflation we're sitting at at the moment at 3.3%.

[00:06:39]Up uh from 3%. Fuel just in March went up 8.7%.

[00:06:46]Uh and that's going to continue feeding into this inflation data. Uh, and I think you're going to see inflation markets expect inflation to peak out now at around 4%.

[00:06:57]Food inflation is going to be a disaster for people on low incomes. That's expected to peak out at 10%. Uh, and that hits people particularly on low incomes. Uh, which isn't great. Now, what do I think about mortgage rates?

[00:07:13]You see, mortgage rates, they went up 1%, didn't they? And what we're saying here is the Bank of England could increase rates by one quarter of a percent to 4% uh possibly in June. Uh you'd be looking at that. So let's just say they do increase the rates. Um I still think you're going to see some mortgage rate drops uh in the next few weeks because they jumped up 1% immediately. The Bank of England's now looking like it might increase quarter of a percent at a worst case scenario.

[00:07:48]So the Sonia swap rate that they're borrowing on that's creeping down a little bit now. Uh and so that allows them to drop rates. We saw many lenders nationwide, HSBC, um Santandere cut rates last week. I think you'll see a little bit more of that this week and next week as well.

[00:08:07]Um, I think you'll see a few more make a decision once the Bank of England does their meeting on Thursday. So, if you want to know what happens, you need to make sure you subscribe to the channel cuz I'll make a video after the Bank of England meeting and let you know exactly what happened. I'll listen to the press conference and let you know what the expectations are. We want to hear where do they think inflation's going to go?

[00:08:31]Where do they feel the oil prices are going to go? There's lots of variables constantly changing on a daily basis with this stuff, but this week I believe they're going to hold and that's what the markets do. Let me know. Let's have a little bet on this. Let me know in the comments what do you think is going to happen. Do you think they're going to hold or do you think they're going to increase or do you think they're going to cut? Let me know in the comments.

[00:08:56]Let's see what you think. Uh do like the video and subscribe and check out all the other videos. We've got nearly 2,000 now. Maybe start with this one right