Market Update June 2026

The Bank of England has chosen to leave the Base Rate unchanged at 3.75%, continuing its cautious approach as it balances inflationary pressures against wider economic growth concerns. 

While a rate hold may not generate the same headlines as a rate cut, it is another sign that the mortgage market has become far more predictable than in the past. Financial markets had largely anticipated the decision, meaning attention remains focused on future inflation data and the potential path of interest rates throughout the remainder of the year. 

Political developments have also moved back into focus following the Prime Minister's announcement that he will step down. Despite the significance of the news, financial markets have reacted calmly, with both sterling and UK government bond yields remaining relatively stable as investors take comfort from the prospect of an orderly leadership transition. In fact, gilt yields have eased from the highs seen earlier this year, helping to support broader market confidence. 

For borrowers, one of the most important factors continues to be lender competition. With funding markets remaining relatively stable and transaction levels below historic norms, many lenders have continued to compete aggressively for new business through product repricing, criteria enhancements and increased lending flexibility. 

As a result, we notice that borrowers are benefiting from competitive fixed-rate deals across a range of loan-to-value bands, alongside improvements in affordability assessments for certain applicant types. 

While uncertainty remains around the pace of future rate reductions, the overall mortgage landscape is significantly more stable than it was during the periods of heightened volatility experienced in recent years. Opting for remortgage or product transfer can be an ideal choice to make longer-term financial decisions.