The benchmark interest rate in the United Kingdom was last recorded at 4 percent. This dataset provides - United Kingdom Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

The average interest rate of instant access deposits in the United Kingdom (UK) has started declining since the second half of 2024. That was after the interest rates of those products soared in 2022 and 2023, peaking at **** percent in January 2024. In contrast, the interest rate of instant access deposits dropped to **** percent in April 2021. As of June 2025, the interest rate amounted to **** percent.

United Kingdom UK: Real Interest Rate data was reported at -1.195 % pa in 2014. This records an increase from the previous number of -1.378 % pa for 2013. United Kingdom UK: Real Interest Rate data is updated yearly, averaging 1.802 % pa from Dec 1967 (Median) to 2014, with 48 observations. The data reached an all-time high of 6.438 % pa in 1985 and a record low of -12.172 % pa in 1975. United Kingdom UK: Real Interest Rate data remains active status in CEIC and is reported by World Bank. The data is categorized under Global Database’s United Kingdom – Table UK.World Bank.WDI: Interest Rates. Real interest rate is the lending interest rate adjusted for inflation as measured by the GDP deflator. The terms and conditions attached to lending rates differ by country, however, limiting their comparability.; ; International Monetary Fund, International Financial Statistics and data files using World Bank data on the GDP deflator.; ;

August 2024 marked a significant shift in the UK's monetary policy, as it saw the first reduction in the official bank base interest rate since August 2023. This change came after a period of consistent rate hikes that began in late 2021. In a bid to minimize the economic effects of the COVID-19 pandemic, the Bank of England cut the official bank base rate in March 2020 to a record low of *** percent. This historic low came just one week after the Bank of England cut rates from **** percent to **** percent in a bid to prevent mass job cuts in the United Kingdom. It remained at *** percent until December 2021 and was increased to one percent in May 2022 and to **** percent in October 2022. After that, the bank rate increased almost on a monthly basis, reaching **** percent in August 2023. It wasn't until August 2024 that the first rate decrease since the previous year occurred, signaling a potential shift in monetary policy. Why do central banks adjust interest rates? Central banks, including the Bank of England, adjust interest rates to manage economic stability and control inflation. Their strategies involve a delicate balance between two main approaches. When central banks raise interest rates, their goal is to cool down an overheated economy. Higher rates curb excessive spending and borrowing, which helps to prevent runaway inflation. This approach is typically used when the economy is growing too quickly or when inflation is rising above desired levels. Conversely, when central banks lower interest rates, they aim to encourage borrowing and investment. This strategy is employed to stimulate economic growth during periods of slowdown or recession. Lower rates make it cheaper for businesses and individuals to borrow money, which can lead to increased spending and investment. This dual approach allows central banks to maintain a balance between promoting growth and controlling inflation, ensuring long-term economic stability. Additionally, adjusting interest rates can influence currency values, impacting international trade and investment flows, further underscoring their critical role in a nation's economic health. Recent interest rate trends Between 2021 and 2024, most advanced and emerging economies experienced a period of regular interest rate hikes. This trend was driven by several factors, including persistent supply chain disruptions, high energy prices, and robust demand pressures. These elements combined to create significant inflationary trends, prompting central banks to raise rates in an effort to temper spending and borrowing. However, in 2024, a shift began to occur in global monetary policy. The European Central Bank (ECB) was among the first major central banks to reverse this trend by cutting interest rates. This move signaled a change in approach aimed at addressing growing economic slowdowns and supporting growth.

Key information about United Kingdom Long Term Interest Rate

• United Kingdom Long Term Interest Rate: Month Avg: United Kingdom: ECB Harmonised was reported at 4.52 % pa in Feb 2025, compared with 4.67 % pa in the previous month.
• UK Long Term Interest Rate data is updated monthly, available from Jan 1993 to Feb 2025.
• The data reached an all-time high of 8.99 % pa in Sep 1994 and a record low of 0.15 % pa in Jul 2020.
• Long Term Interest Rate is reported by reported by CEIC Data.

• In the latest reports, UK Short Term Interest Rate: Month End: ICE LIBOR: 3 Months was reported at 0.09 % pa in Apr 2021.
• The cash rate (Policy Rate: Month End: Base Rate) was set at 4.50 % pa in Feb 2025.
• UK Exchange Rate against USD averaged 0.79 (USD/GBP) in Jun 2023.

Key information about United Kingdom Short Term Interest Rate

• United Kingdom Short Term Interest Rate: Month End: ICE LIBOR: 3 Months was reported at 0.09 % pa in Apr 2021, compared with 0.09 % pa in the previous month.
• UK Short Term Interest Rate data is updated monthly, available from Jan 1986 to Apr 2021.
• The data reached an all-time high of 15.38 % pa in Apr 1990 and a record low of 0.03 % pa in Dec 2020.
• Short Term Interest Rate is reported by reported by ICE Benchmark Administration.

• In the latest reports, UK Long Term Interest Rate: Month Avg: United Kingdom: ECB Harmonised was reported at 3.95 % pa in May 2023.
• The cash rate (Policy Rate: Month End: Base Rate) was set at 4.50 % pa in May 2023.
• UK Exchange Rate against USD averaged 0.80 (USD/GBP) in May 2023.

When asked about "Interest in product categories", most UK respondents pick ********** as an answer. ** percent did so in our online survey in 2025.

Graph and download economic data for Interest Rates, Government Securities, Government Bonds for United Kingdom (INTGSBGBM193N) from Jan 1957 to Jun 2025 about United Kingdom, bonds, securities, government, interest rate, interest, and rate.

Key information about United Kingdom Policy Rate

• United Kingdom cash rate (Policy Rate: Month End: Base Rate) was set at 4.50 % pa in Feb 2025, compared with 4.75 % pa in the previous Jan 2025.
• UK Policy Rate averaged 5.75 % pa and is updated monthly, available from Jun 1972 to Feb 2025.
• The data reached an all-time high of 17.00 % pa in Jun 1980 and a record low of 0.10 % pa in Nov 2021.

• In the latest reports, UK Short Term Interest Rate: Month End: ICE LIBOR: 3 Months was reported at 0.09 % pa in Apr 2021.
• Its Long Term Interest Rate (Long Term Interest Rate: Month Avg: United Kingdom: ECB Harmonised ) was reported at 4.67 % pa in Jan 2025.
• UK Exchange Rate against USD averaged 0.79 (USD/GBP) in Jun 2023.
• Its Real Effective Exchange Rate was 87.74 in Jan 2025.

The United Kingdom: Interest rates on bank credit to the private sector: The latest value from 2014 is 0.5 percent, unchanged from 0.5 percent in 2013. In comparison, the world average is 11.28 percent, based on data from 135 countries. Historically, the average for the United Kingdom from 1967 to 2014 is 7.37 percent. The minimum value, 0.5 percent, was reached in 2010 while the maximum of 16.31 percent was recorded in 1980.

Graph and download economic data for Interest Rates: Immediate Rates (< 24 Hours): Call Money/Interbank Rate: Total for United Kingdom (IRSTCI01GBQ156N) from Q1 1978 to Q2 2025 about interbank, overnight, United Kingdom, interest rate, interest, and rate.

United Kingdom UK: Lending Interest Rate data was reported at 0.500 % pa in 2014. This stayed constant from the previous number of 0.500 % pa for 2013. United Kingdom UK: Lending Interest Rate data is updated yearly, averaging 6.963 % pa from Dec 1967 (Median) to 2014, with 48 observations. The data reached an all-time high of 16.313 % pa in 1980 and a record low of 0.500 % pa in 2014. United Kingdom UK: Lending Interest Rate data remains active status in CEIC and is reported by World Bank. The data is categorized under Global Database’s United Kingdom – Table UK.World Bank.WDI: Interest Rates. Lending rate is the bank rate that usually meets the short- and medium-term financing needs of the private sector. This rate is normally differentiated according to creditworthiness of borrowers and objectives of financing. The terms and conditions attached to these rates differ by country, however, limiting their comparability.; ; International Monetary Fund, International Financial Statistics and data files.; ;

Based on an "illustrative scenario" in which the United Kingdom (UK) moves to a comprehensive free trade agreement with the European Union (EU) on the 1st of January 2021, this forecast shows the expected annual average bank base interest rate in response to the current Covid-19 pandemic. In a bid to minimize the economic effects of the Covid-19 virus, on the 19th of March 2020 the Bank of England cut the official bank base rate to a record low of 0.1 percent. This historic low came just one week after the Bank of England cut rates from 0.75 percent to 0.25 percent in a bid to prevent mass job cuts in the United Kingdom. In the current forecast scenario, bank interest rates are set to stay between 0.1 percent and 0.2 percent up to 2022.

Public sector debt interest spending in the United Kingdom reached 124.7 billion British pounds in 2024/25, compared with just under 126.6 billion pounds in the previous year.

Interest Rate on Outstanding Mortgages in the United Kingdom increased to 3.88 percent in June from 3.87 percent in May of 2025. This dataset includes a chart with historical data for the United Kingdom Interest Rate on Outstanding Mortgages.

Interest payments (% of revenue) in United Kingdom was reported at 9.0309 % in 2023, according to the World Bank collection of development indicators, compiled from officially recognized sources. United Kingdom - Interest payments (% of revenue) - actual values, historical data, forecasts and projections were sourced from the World Bank on September of 2025.

Interest rate on new mortgages in the United Kingdom decreased to 4.34 percent in June from 4.47 percent in May of 2025. This dataset includes a chart with historical data for the United Kingdom Interest Rate on New Mortgages.

Bank deposit interest rate, percent in the United Kingdom, June, 2025 The most recent value is 3.91 percent as of June 2025, an increase compared to the previous value of 3.9 percent. Historically, the average for the United Kingdom from January 2012 to June 2025 is 1.7 percent. The minimum of 0.24 percent was recorded in July 2021, while the maximum of 5.25 percent was reached in October 2023. | TheGlobalEconomy.com

Following the BoE’s interest rate cut, explore the immediate impact on the UK economy and how finance professionals and businesses can navigate the prospect of future reductions.

United Kingdom UK: Expenditure: Interest Payments: % of Revenue data was reported at 6.817 % in 2016. This records an increase from the previous number of 6.564 % for 2015. United Kingdom UK: Expenditure: Interest Payments: % of Revenue data is updated yearly, averaging 8.918 % from Dec 1972 (Median) to 2016, with 45 observations. The data reached an all-time high of 11.791 % in 1979 and a record low of 5.356 % in 2004. United Kingdom UK: Expenditure: Interest Payments: % of Revenue data remains active status in CEIC and is reported by World Bank. The data is categorized under Global Database’s UK – Table UK.World Bank: Government Revenue, Expenditure and Finance. Interest payments include interest payments on government debt--including long-term bonds, long-term loans, and other debt instruments--to domestic and foreign residents.; ; International Monetary Fund, Government Finance Statistics Yearbook and data files.; Median;