Base rate cuts cause glaring divide among consumers

Rachel Springall, Press Officer / Finance Expert 01603 476210 Email Rachel

Base rate cuts cause glaring divide among consumers

A third of consumers now feel negatively towards future cuts to the Bank of England Base Rate (BBR). Since August 2025, savings rates have fallen, but mortgage rates have only reduced marginally, according to Moneyfactscompare.co.uk analysis.

Around a third of consumers (36%) feel negative towards a potential cut in the Bank of England Base Rate (BBR)*. Cuts to the BBR continue to be a double-edged sword.
Despite a cut of 0.25% to BBR in August, fixed mortgage rates went up, not down, as lenders increased rates during September. Due to falling swap rates in October, fixed mortgage rates have dipped back down, but such volatility shows how sensitive the mortgage market is surrounding economic uncertainty. The Moneyfacts Average Mortgage rate has fallen by just 0.05% in three months (August – November).
Real returns on variable rate savings accounts continue to deteriorate, with easy access, notice and cash ISA equivalents paying less than 3.8% (CPI). The Moneyfacts Average Savings Rate sits below inflation, savers are urged to compare and switch.
Less than a third (23%) of consumers keep their savings stashed in a stocks and shares ISA, compared to 44% in a cash ISA, but as more than half of consumers (55%) save to feel financially secure, they are unlikely to be willing to risk their cash by investing. However, savers may be getting a poor return, as one in three (35%) choose a savings account with the provider they bank with, such as high street banks.

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

“Dividing thoughts among consumers on further cuts to the Bank of England Base Rate is understandable. Borrowers may expect cheaper mortgage rates as a result, which is not guaranteed, and savers end up hit the hardest. Savers are already seeing negative returns on their hard-earned cash if it’s stashed in a pot they can quickly access, so it’s no wonder if they feel demoralised. However, even if cash savings rates dwindle, it will not get people to invest if their core reason for saving is to feel financially secure. This couples up with the sentiment to save with an existing bank, and indeed choosing a cash ISA instead of a stocks and shares ISA. Cutting the cash ISA allowance would therefore be an awful decision for savers, but it could also cause havoc in the mortgage market, as it would reduce funding for loans.”

Base rate cuts cause glaring divide among consumers

Around a third of consumers (36%) feel negative towards a potential cut in the Bank of England Base Rate (BBR)*. Cuts to the BBR continue to be a double-edged sword.
Despite a cut of 0.25% to BBR in August, fixed mortgage rates went up, not down, as lenders increased rates during September. Due to falling swap rates in October, fixed mortgage rates have dipped back down, but such volatility shows how sensitive the mortgage market is surrounding economic uncertainty. The Moneyfacts Average Mortgage rate has fallen by just 0.05% in three months (August – November).
Real returns on variable rate savings accounts continue to deteriorate, with easy access, notice and cash ISA equivalents paying less than 3.8% (CPI). The Moneyfacts Average Savings Rate sits below inflation, savers are urged to compare and switch.
Less than a third (23%) of consumers keep their savings stashed in a stocks and shares ISA, compared to 44% in a cash ISA, but as more than half of consumers (55%) save to feel financially secure, they are unlikely to be willing to risk their cash by investing. However, savers may be getting a poor return, as one in three (35%) choose a savings account with the provider they bank with, such as high street banks.

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

Mortgage market analysis

Since the Bank of England Base Rate was cut to 4% in August 2025, there have only been slight falls to average mortgage rates. The average standard variable rate (SVR) has fallen by 0.15%, from 7.42% to 7.27% since the start of August 2025.
The average two- and five-year fixed rates have both dropped from 5.01% since the start of August 2025; a year ago, the rates were 5.39% and 5.09% respectively. They now stand at 4.94% and 5.01%, lower than a month ago.
The Moneyfacts Average Mortgage Rate has fallen to 4.99%, down from 5.04% in August 2025. It is down from 5.31% since November 2024, and lower than 6.07% in November 2023. In November 2022 the rate was 6.19%.

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

“There will no doubt be borrowers thrilled to see mortgage rates on the downward trend, if they are looking to remortgage soon. It’s important to remind borrowers to not delay refinancing, such as waiting for more Bank of England Base Rate cuts, because fixed mortgages are more intrinsically linked to swap rates. As shown in average rates, fixed mortgage increases were en masse during September, the swap market was not looking favourably on future interest rate decisions. Thankfully, the recent falls have led lenders to review their pricing, with many reducing rates. The incentive to switch from a revert rate to a two-year fixed deal could save borrowers £358 per month* on their mortgage repayments.

“The Budget rumour mill to abolish stamp duty can cause confusion among borrowers, with new buyers adopting a ‘wait and see’ stance. The proposals on paying tax put the burden on sellers, rather than buyers. While this may be a significant change for first-time buyers, it will impact those looking to sell-up, such as those who need to downsize. Unfortunately, if this does come into play, alongside rumours around removing CGT exemptions on primary residences, it could lead to homeowners refusing to move, hitting supply. The other suggestions are to introduce a ‘mansion tax’, a yearly tax levy on high valued properties. Unsurprisingly, the controversy around such property tax changes could steer sellers to feel rushed, but they should always seek advice before making any rash decisions.”

*Average standard variable rate (SVR) is currently 7.27%. Calculations based on a £250,000 mortgage over a 25-year term on a repayment basis. SVR repayment £1,810 per month, versus £1,452 per month on 4.94% two-year fixed rate.

Mortgage market analysis
Average mortgage rates	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Standard variable rate (SVR)	4.40%	5.86%	8.19%	7.95%	7.27%	7.27%
Two-year fixed mortgage	2.34%	6.47%	6.29%	5.39%	4.98%	4.94%
Five-year fixed mortgage	2.64%	6.32%	5.86%	5.09%	5.02%	5.01%
10-year fixed mortgage	2.97%	5.65%	5.75%	5.58%	5.71%	5.71%
Average rates shown are as at the first available day of the month, unless stated otherwise. Source: Moneyfactscompare.co.uk

Moneyfacts Average Mortgage Rate
	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Moneyfacts Average Mortgage Rate	2.49%	6.19%	6.07%	5.31%	5.02%	4.99%
Calculated from the total of all on-sale, core market, fixed and variable tracker mortgages. Standard exclusions apply: Self-build only, shared ownership only, new build only, shared equity only, standard variable rates and adverse credit.
Source: Moneyfacts Average Mortgage Rate.

Mortgage market analysis

Since the Bank of England Base Rate was cut to 4% in August 2025, there have only been slight falls to average mortgage rates. The average standard variable rate (SVR) has fallen by 0.15%, from 7.42% to 7.27% since the start of August 2025.
The average two- and five-year fixed rates have both dropped from 5.01% since the start of August 2025; a year ago, the rates were 5.39% and 5.09% respectively. They now stand at 4.94% and 5.01%, lower than a month ago.
The Moneyfacts Average Mortgage Rate has fallen to 4.99%, down from 5.04% in August 2025. It is down from 5.31% since November 2024, and lower than 6.07% in November 2023. In November 2022 the rate was 6.19%.

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

Mortgage market analysis
Average mortgage rates	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Standard variable rate (SVR)	4.40%	5.86%	8.19%	7.95%	7.27%	7.27%
Two-year fixed mortgage	2.34%	6.47%	6.29%	5.39%	4.98%	4.94%
Five-year fixed mortgage	2.64%	6.32%	5.86%	5.09%	5.02%	5.01%
10-year fixed mortgage	2.97%	5.65%	5.75%	5.58%	5.71%	5.71%
Average rates shown are as at the first available day of the month, unless stated otherwise. Source: Moneyfactscompare.co.uk

Moneyfacts Average Mortgage Rate
	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Moneyfacts Average Mortgage Rate	2.49%	6.19%	6.07%	5.31%	5.02%	4.99%
Calculated from the total of all on-sale, core market, fixed and variable tracker mortgages. Standard exclusions apply: Self-build only, shared ownership only, new build only, shared equity only, standard variable rates and adverse credit.
Source: Moneyfacts Average Mortgage Rate.

Savings market analysis

Year-on-year average rates across easy access and notice accounts have fallen, with the average easy access rate down from 3.03% to 2.52%, and the average easy access ISA rate down from 3.24% to 2.71%. The average notice account has fallen from 4.22% to 3.49% and the average notice ISA rate has fallen from 4.05% to 3.41%.
Since the start of August 2025 (just a few days before BBR was cut to 4.00%), the average easy access savings rate has fallen by 0.16%, from 2.68% to 2.52% and the average easy access ISA rate fell by 0.19% from 2.90% to 2.71%.
The average notice rate has fallen by 0.14% from 3.63% to 3.49% since the start of August 2025 and the average rate on a notice ISA has fallen by 0.08% from 3.49% to 3.41%.
The Moneyfacts Average Savings Rate has fallen to 3.42%, down from 3.50% in August 2025. It is down from 3.71% since November 2024, and lower than 4.35% in November 2023, but higher than 2.59% in November 2022. The rate was last above 4% in January 2024 (4.04%).

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

“Savers will feel disheartened to see variable savings rates fall this year, but hopefully this does not damage their aspirations. Easy access accounts remain a haven for savers, as they are a great choice for an emergency fund. Those who use these for convenience do need to compare rates regularly, as they get hit when BBR gets cut. Challenger banks continue to entice new customers with high rates, but savers must make sure the account suits their needs. A few of the best deals carry bonus rates, so the responsibility is on the saver to be vigilant and switch before these expire. Savers may well prefer to open a savings account with a brand they trust, but such loyalty doesn’t always pay.

“A convenient way for consumers to save their money is to stash it in a current account, or a simple saver with their bank, but that’s not the best choice. These simple savers can pay shockingly low rates, so in real terms, the cash is eroded by inflation. Despite that, loads of cash continues to put aside this way. According to the Bank of England, £5.8bn was deposited in interest-bearing sight deposits during September. While you can’t blame savers for wanting a ‘risk-free’ safety net to fall back on, it’s still important to compare rates. Frustrated savers who are fed up of seeing their cash eroded by inflation might be more inclined to open a fixed rate bond or ISA, with many paying a guaranteed return of 4% or more. Taking time to shop around for the best rates and switching is essential to get any cash working harder.

“The Budget rumour mill encroaches on savers, with a warning of a cut to the cash ISA allowance from £20,000 to £10,000. It is unlikely such radical change would happen overnight, so savers should not panic. However, it would be unwise to not make use of their cash ISA allowance, but also to review any older pots. This is particularly important for those impacted by fiscal drag, where basic rate taxpayers who edge up into the higher-rate tax bracket at 40% will have their Personal Savings Allowance (PSA) halved from £1,000 to £500. Those worried about being taxed on their hard-earned savings would be wise to seek advice to assess all their pots.”

Savings market analysis
Average savings rates	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Easy access	0.20%	1.16%	3.19%	3.03%	2.50%	2.52%
Notice account	0.54%	1.95%	4.31%	4.22%	3.53%	3.49%
Easy access ISA	0.26%	1.26%	3.29%	3.24%	2.72%	2.71%
Notice ISA	0.37%	1.72%	4.12%	4.05%	3.43%	3.41%
Averages based on £10,000 gross rate. Average rates shown are as at the first available day of the month, unless stated otherwise. Source: Moneyfactscompare.co.uk

Moneyfacts Average Savings Rate
	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Moneyfacts Average Savings Rate	0.67%	2.59%	4.35%	3.71%	3.44%	3.42%
Calculated from the total of all on-sale, core market, variable and fixed rate savings accounts and Cash ISAs. Standard exclusions apply: Regular savings, children’s accounts, LISAs and JISAs.
Source: Moneyfacts Average Savings Rate.

*Survey of 2,000 nationally representative UK adults carried out by OnePoll on behalf of Moneyfacts between 1 - 3 September 2025. Savings index data and analysis can be found here.

Savings market analysis

Year-on-year average rates across easy access and notice accounts have fallen, with the average easy access rate down from 3.03% to 2.52%, and the average easy access ISA rate down from 3.24% to 2.71%. The average notice account has fallen from 4.22% to 3.49% and the average notice ISA rate has fallen from 4.05% to 3.41%.
Since the start of August 2025 (just a few days before BBR was cut to 4.00%), the average easy access savings rate has fallen by 0.16%, from 2.68% to 2.52% and the average easy access ISA rate fell by 0.19% from 2.90% to 2.71%.
The average notice rate has fallen by 0.14% from 3.63% to 3.49% since the start of August 2025 and the average rate on a notice ISA has fallen by 0.08% from 3.49% to 3.41%.
The Moneyfacts Average Savings Rate has fallen to 3.42%, down from 3.50% in August 2025. It is down from 3.71% since November 2024, and lower than 4.35% in November 2023, but higher than 2.59% in November 2022. The rate was last above 4% in January 2024 (4.04%).

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said:

Savings market analysis
Average savings rates	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Easy access	0.20%	1.16%	3.19%	3.03%	2.50%	2.52%
Notice account	0.54%	1.95%	4.31%	4.22%	3.53%	3.49%
Easy access ISA	0.26%	1.26%	3.29%	3.24%	2.72%	2.71%
Notice ISA	0.37%	1.72%	4.12%	4.05%	3.43%	3.41%
Averages based on £10,000 gross rate. Average rates shown are as at the first available day of the month, unless stated otherwise. Source: Moneyfactscompare.co.uk

Moneyfacts Average Savings Rate
	Dec-21	Nov-22	Nov-23	Nov-24	Oct-25	Nov-25
Moneyfacts Average Savings Rate	0.67%	2.59%	4.35%	3.71%	3.44%	3.42%
Calculated from the total of all on-sale, core market, variable and fixed rate savings accounts and Cash ISAs. Standard exclusions apply: Regular savings, children’s accounts, LISAs and JISAs.
Source: Moneyfacts Average Savings Rate.

*Survey of 2,000 nationally representative UK adults carried out by OnePoll on behalf of Moneyfacts between 1 - 3 September 2025. Savings index data and analysis can be found here.

Notes to editors

You are welcome to use part or all of this press release, so long as we are sufficiently sourced. We would appreciate a link back to Moneyfactscompare.co.uk.

Pioneering financial comparison technology for over 35 years, Moneyfacts Group plc is the UK’s leading provider of retail financial product data. Used by virtually every bank and building society in the UK, and supplied to the Bank of England, Financial Conduct Authority, Financial Ombudsman Service, HM Treasury, Prudential Regulatory Authority and UK Finance.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, banking, life, pension and investment products in the UK.

Moneyfactscompare.co.uk is the financial product price comparison site, launched as Moneyfacts.co.uk in 2000 and rebranded to Moneyfactscompare.co.uk in 2023, which helps consumers compare thousands of financial products, including credit cards, savings, mortgages and many more. Unlike other comparison sites, Moneyfactscompare.co.uk shows whole of market data regardless of commercial bias, showing consumers a true picture of the best products based on the criteria they select.

For more information about us please see our key facts.

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Notes to editors

You are welcome to use part or all of this press release, so long as we are sufficiently sourced. We would appreciate a link back to Moneyfactscompare.co.uk.

Our expert research team monitors the thousands of mortgages, savings, credit card, personal loan, banking, life, pension and investment products in the UK.

For more information about us please see our key facts.

Broadcast

Our broadcast suite enables our finance experts to appear in-vision for television, and we regularly comment live on national and regional radio.

To arrange an interview for radio or television, please contact our press department. We have an in-house broadcast room.

If you're looking for extra comment, a chart or more information, then please give us a call. We are always more than happy to help.

Adam French Head of News & Communications

01603 476154

Email Adam

Rachel Springall Press Officer / Finance Expert

01603 476210

Email Rachel

Caitlyn Eastell Press & PR Executive