Bank Lending Rate in the United Kingdom increased to 8.62 percent in September from 8.59 percent in August of 2025. This dataset provides - United Kingdom Prime Lending Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

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 2025, 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 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.

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.

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.

Interest Rate since 1694 from Bank of England.

Data comes from the Bank of England Website www.bankofengland.co.uk. Rate is either minimum lending rate, minimum band 1 dealing rate, or repo rate de...

Graph and download economic data for Bank of England Policy Rate in the United Kingdom (BOERUKM) from Nov 1694 to Jan 2017 about academic data, United Kingdom, and rate.

Mortgage rates surged at an unprecedented pace in 2022, with the average 10-year fixed rate doubling between March and December of that year. In response to mounting inflation, the Bank of England implemented a series of rate hikes, pushing borrowing costs steadily higher. By October 2025, the average 10-year fixed mortgage rate stood at **** percent. As financing becomes more expensive, housing demand has cooled, weighing on market sentiment and slowing house price growth. How have the mortgage hikes affected the market? After surging in 2021, the number of residential properties sold fell significantly in 2023, dipping to just above *** million transactions. This contraction in activity also dampened mortgage lending. Between the first quarter of 2023 and the first quarter of 2024, the value of new mortgage loans declined year-on-year for five consecutive quarters. Even as rates eased modestly in 2024 and housing activity picked up slightly, volumes remained well below the highs recorded in 2021. How are higher mortgages impacting homebuyers? For homeowners, the impact is being felt most acutely as fixed-rate deals expire. Mortgage terms in the UK typically range from two to ten years, and many borrowers who locked in historically low rates are now facing significantly higher repayments when refinancing. By the end of 2026, an estimated five million homeowners will see their mortgage deals expire. Roughly two million of these loans are projected to experience a monthly payment increase of up to *** British pounds by 2026, putting additional pressure on household budgets and constraining affordability across the market.

United Kingdom UK: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data was reported at 0.120 % pa in 2014. This records a decrease from the previous number of 0.199 % pa for 2013. United Kingdom UK: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data is updated yearly, averaging 0.280 % pa from Dec 1967 (Median) to 2014, with 48 observations. The data reached an all-time high of 1.995 % pa in 1972 and a record low of -2.372 % pa in 1974. United Kingdom UK: Risk Premium on Lending: Lending Rate Minus Treasury Bill 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. Risk premium on lending is the interest rate charged by banks on loans to private sector customers minus the 'risk free' treasury bill interest rate at which short-term government securities are issued or traded in the market. In some countries this spread may be negative, indicating that the market considers its best corporate clients to be lower risk than the government. The terms and conditions attached to lending rates differ by country, however, limiting their comparability.; ; International Monetary Fund, International Financial Statistics database.; ;

Key information about United Kingdom Policy Rate

• United Kingdom cash rate (Policy Rate: Month End: Base Rate) was set at 4.00 % pa in Nov 2025, compared with 4.00 % pa in the previous Oct 2025.
• UK Policy Rate averaged 5.50 % pa and is updated monthly, available from Jun 1972 to Nov 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 End: United Kingdom: Government Bond Yield: 10 Years) was reported at 4.48 % pa in Oct 2025.
• UK Exchange Rate against USD averaged 0.75 (USD/GBP) in Oct 2025.
• Its Real Effective Exchange Rate was 89.08 in Oct 2025.

United Kingdom Lending Rate: Outs: Households: Personal Loan (PL) data was reported at 8.240 % pa in Mar 2025. This records a decrease from the previous number of 8.290 % pa for Feb 2025. United Kingdom Lending Rate: Outs: Households: Personal Loan (PL) data is updated monthly, averaging 7.590 % pa from Jan 1999 (Median) to Mar 2025, with 315 observations. The data reached an all-time high of 12.190 % pa in Jan 1999 and a record low of 5.410 % pa in Apr 2021. United Kingdom Lending Rate: Outs: Households: Personal Loan (PL) data remains active status in CEIC and is reported by Bank of England. The data is categorized under Global Database’s United Kingdom – Table UK.M002: Lending Rate: Outstanding. [COVID-19-IMPACT]

The interest rate for credit cards in the UK grew to an all-time high in May 2025, even though the base rate for the Bank of England grew at a slower pace that month. Credit card interest rates tend to be significantly higher than other forms of lending, and the United Kingdom is no exception to this. By May 2025, the average interest rate had increased to ***** percent. The Bank of England base rate stood at **** percent since April 2025 – which was not yet the highest value observed. Nevertheless, the central bank's interest rate grew slower than that of credit cards.

Compare UK interest rates and mortgage rates alongside house prices. Interactive charts showing the Bank of England base rate versus 2-year, 5-year, and SVR mortgage rates, with historical HPI trends.

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.; ;

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.

Policy interest rates in the U.S. and Europe are forecasted to decrease gradually between 2024 and 2027, following exceptional increases triggered by soaring inflation between 2021 and 2023. The U.S. federal funds rate stood at **** percent at the end of 2023, the European Central Bank deposit rate at **** percent, and the Swiss National Bank policy rate at **** percent. With inflationary pressures stabilizing, policy interest rates are forecast to decrease in each observed region. The U.S. federal funds rate is expected to decrease to *** percent, the ECB refi rate to **** percent, the Bank of England bank rate to **** percent, and the Swiss National Bank policy rate to **** percent by 2025. An interesting aspect to note is the impact of these interest rate changes on various economic factors such as growth, employment, and inflation. The impact of central bank policy rates The U.S. federal funds effective rate, crucial in determining the interest rate paid by depository institutions, experienced drastic changes in response to the COVID-19 pandemic. The subsequent slight changes in the effective rate reflected the efforts to stimulate the economy and manage economic factors such as inflation. Such fluctuations in the federal funds rate have had a significant impact on the overall economy. The European Central Bank's decision to cut its fixed interest rate in June 2024 for the first time since 2016 marked a significant shift in attitude towards economic conditions. The reasons behind the fluctuations in the ECB's interest rate reflect its mandate to ensure price stability and manage inflation, shedding light on the complex interplay between interest rates and economic factors. Inflation and real interest rates The relationship between inflation and interest rates is critical in understanding the actions of central banks. Central banks' efforts to manage inflation through interest rate adjustments reveal the intricate balance between economic growth and inflation. Additionally, the concept of real interest rates, adjusted for inflation, provides valuable insights into the impact of inflation on the economy.

United Kingdom Lending Rate: Outs: PN: Loan: Fixed data was reported at 4.160 % pa in Oct 2018. This records an increase from the previous number of 4.150 % pa for Sep 2018. United Kingdom Lending Rate: Outs: PN: Loan: Fixed data is updated monthly, averaging 4.865 % pa from Jan 1999 (Median) to Oct 2018, with 238 observations. The data reached an all-time high of 7.460 % pa in Dec 2007 and a record low of 3.170 % pa in Dec 2009. United Kingdom Lending Rate: Outs: PN: Loan: Fixed data remains active status in CEIC and is reported by Bank of England. The data is categorized under Global Database’s United Kingdom – Table UK.M002: Lending Rate: Outstanding.

Lending Rate in the United Kingdom remained unchanged at 4.25 percent in November. This dataset provides - United Kingdom Operational Standing Lending Facility Rate- actual values, historical data, forecast, chart, statistics, economic calendar and news.

United Kingdom Lending Rate: Outs: NB: PN: Loan: Fixed data was reported at 3.990 % pa in Oct 2018. This records an increase from the previous number of 3.290 % pa for Sep 2018. United Kingdom Lending Rate: Outs: NB: PN: Loan: Fixed data is updated monthly, averaging 3.750 % pa from Jan 1999 (Median) to Oct 2018, with 238 observations. The data reached an all-time high of 7.600 % pa in Aug 2007 and a record low of 2.030 % pa in Aug 2009. United Kingdom Lending Rate: Outs: NB: PN: Loan: Fixed data remains active status in CEIC and is reported by Bank of England. The data is categorized under Global Database’s United Kingdom – Table UK.M002: Lending Rate: Outstanding.