“Uncertainty is currently the order of the day, as this new Government finds its feet and irons out its policy. Against that backdrop, the decision to keep the ship steady and hold interest rates at 3.75% is welcomed by homeowners and businesses alike, especially after predictions of a potential rise, as 16 banks and building societies raised mortgage rates this week amid ongoing instability in the Middle East. “Inflation is of course not controlled from Threadneedle Street, despite the best efforts of the MPC, and we will likely need to see a long-term resolution to the conflict in Iran if rates are to come down. We saw EY this week note that GDP growth is expected to slow to 0.9% this year and further to 0.7% next year, influenced primarily by rising oil prices. “But whilst Britain cannot control events overseas, it can tackle the frictions holding back growth at home. From planning reform and housing delivery to productivity and tax competitiveness, there are levers firmly within the Government’s grasp. Reform to any of these could take years to have an effect, so the spotlight is on measures that could support growth in the immediate term. And as the base rate is expected to rise to 4% in September, we need to think about ways to boost confidence, spending, and investment ahead of this change. Affordability concerns and debt levels continue to be primary market drivers. The road ahead feels uncertain, but hopeful, if swift action can be taken.” 
Andrew Lloyd
, Managing Director at Search Acumen, says:
