Bank of England base rate set to stay at 3.75% next week
Quick Summary
The Bank of England base rate is set to stay on hold at 3.75% next week, but the market expectation is that there are still base rate cuts to come this year. NatWest and Barclays have increased the prices of some of their fixed mortgage rates, although Trinity Financial's brokers still have access to two-year fixes from 3.5% and five-year fixes from 3.7%.
The Bank of England Monetary Policy Committee meets next Thursday (5th March) and no change is expected to be made to the current 3.75% base rate.
Focus will be on the vote split and the updated economic forecasts, with markets pricing in a further cut in April, as the UK economic backdrop remains fragile, with weak jobs, slow growth, and rising political risk.
In Arbuthnot Latham's latest market update, the private bank states that “The market is very much in risk-on mode, driven by global growth optimism, with stocks and gold hitting record highs.
“The US central bank kept rates on hold as expected, despite pressure from Donald Trump, who is likely to announce his nomination for a new Fed chair imminently.”
The European Central Bank also meets next week with no change expected as EU growth momentum picks up, helped by the Indian trade deal, with the euro benefiting from the growing ‘sell-US’ theme.
Property transactions up in December
Property transactions are up 5% on a year ago, government data has revealed.
The number of UK residential transactions in December 2025 was 100,440, 5% higher than December 2024 and marginally lower (less than 1%) than November 2025.
The number of UK non-residential transactions in December 2025 was 10,640, 7% higher than December 2024 and 10% lower than November 2025.
Residential mortgage approvals totalled 61,013 in December, down 4.8% from November and 8.4% below the 66,634 seen in December 2024, according to the latest figures from the Bank of England.
Aaron Strutt, product director at Trinity Financial, says: "There is little doubt that changes to mortgage affordability rules, along with cheaper fixed rates, are starting to make a difference by helping more people to get on the property ladder.
"It is a buyer's market at the moment, and confidence is starting to return, even though global economic uncertainty remains. Lots of potential buyers have been holding off buying and waiting for property prices to come down, and they have dropped in certain areas, especially when homes have been on the market for a long time."
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The information contained within was correct at the time of publication but is subject to change.
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