The next meeting of the Bank of England's Monetary Policy Committee (MPC), scheduled for Thursday, 2 November, is generating significant attention. There's an air of anticipation surrounding this meeting, with diverse expectations and viewpoints from MPC members, experts, and government officials. The meeting is poised to be pivotal, as it will determine the fate of the economy and the battle against inflation. The forecast is for either the rate to remain steady or for it to be raised a minimal amount such as 0.25%.

In August, the MPC decided on a 0.25% rate hike, and the following month in September the rate was held steady. This ended the fourteen consecutive meetings that resulted in a rate hike starting in December 2021. The current rate is the highest it has been in 15 years at 5.25%,

October did not have a scheduled meeting. The remaining two months of the year will see MPC meetings raising questions about whether a more substantial rate increase is needed to combat inflation effectively. The latest report on inflation revealed it stuck at 6.7% having reduced to 6.7% in September from 6.8% in August, and much improved since the double-digit report of 11.8% in January.

However, inflation at 6.7%, though lower than at the start of the year, is still more than three times the target rate set by the Bank of England for inflation to be at 2.0%.

The decision to raise the rate or not will be influenced by the fact that unemployment has recently been reported to have grown.

Regardless of the MPC's decision on Thursday of whether to maintain the current rate or increase it, one thing remains certain: rate cuts are not on the horizon. Borrowers anticipating lower rates or a downward trend in borrowing costs should reevaluate their expectations. The historically low rates observed during the pandemic were an anomaly, not reflective of a robust economy. The rates available now are more likely to persist or even rise in the coming months.

Some experts believe the target rate will not be reached until 2025.

The MPC meeting promises to be an interesting event with potential far-reaching consequences for borrowers. Typically, after an MPC rate hike announcement, borrowers witness lenders swiftly adjusting their interest rate offers. Lower-cost interest rate options disappear from the market, replaced by higher rate offerings when the rate is raised.

This is a concern for November even if the rate is left steady. The longer inflation remains stubborn, and in consideration of the latest unemployment information, as well as the global economic impacts due to the wars of Ukraine and Gaza, lenders could become cautious and tighten lending. 

However, this year’s higher rates have resulted in decreased borrowing activity. Fewer homebuyers are in the market, with cash buyers dominating the scene, unfazed by interest rate hikes. This reduced demand for borrowing has led to a competitive market that has only recently surfaced.

In the past month without a MPC meeting, some lenders have begun offering lower interest rates. It's essential to note that many of these rate cuts target individuals with substantial deposits and impeccable credit histories. The majority of mortgage seekers, particularly first-time buyers struggling to save for deposits in the current economy, will find the rates still challenging and affecting their ability to climb onto the property ladder.

The disparity in borrowing costs is discouraging many from entering the housing market. It's also creating affordability issues for homeowners whose mortgage terms are ending. 

Homeowners who secured historically low fixed-rate deals two years ago and are nearing the end of their terms within the next few months will face higher annual repayments. This is why experts are advising homeowners not to let their mortgage terms expire without considering remortgaging.

Allowing the term to lapse without securing a new deal will lead the lender to transition the borrower to their standard variable rate or SVR. Opting for a remortgage can result in significant savings. Moreover, securing a fixed rate through remortgaging provides peace of mind against potential future rate hikes.

For homeowners exploring remortgaging options, the process is quick and convenient online. Remortgage broker websites can provide multiple quotes from various lenders, often including exclusive deals not directly available to borrowers. Alternatively, homeowners can visit individual remortgage lender websites to gather and compare quotes.

With the next MPC meeting days away, there's limited time for borrowers to take action, so their decision will be important. The next meetings for the MPC will be in December and in February. Depending on the decision Thursday by the MPC, and how their decision cuts inflation, it will determine what is ahead for borrowers.