The Monetary Policy Committee: who sets UK interest rates and when it meets

Interest rates in the UK are set by the Bank of England's Monetary Policy Committee, or MPC, not by the Government. The committee is a group of nine people who meet about every six weeks to look at the latest economic evidence and vote on Bank Rate, the UK's official interest rate¹. Bank Rate is currently 3.75%, and it has been held at that level through the committee's most recent meetings². The next scheduled meeting is on Thursday 5 November 2026, with one further meeting in December 2026³.

The committee's job is to keep inflation at the 2% target the Government sets it¹. When it changes Bank Rate, the effects reach households indirectly: the rate the Bank pays to commercial banks feeds through to mortgage rates, savings rates and the cost of borrowing, usually over a period of up to two years⁴. This page explains who sits on the committee, how a decision is made and announced, when the meetings happen, and what the Bank of England does and does not do for ordinary consumers.

The Monetary Policy Committee sets Bank Rate, not the Government

The question of who sets UK interest rates has a clear answer: the Monetary Policy Committee of the Bank of England. The Bank describes itself as the UK's central bank and a publicly owned body, and its statutory objective is monetary (price) and financial stability⁵. Bank Rate is the core interest rate in the UK, and the Bank states plainly that setting it is its job⁶.

The committee's structure is not a matter of custom but of law. The Bank of England Act 1998 sets out the membership structure of the MPC, and the Bank of England and Financial Services Act 2016 sets out how decisions are made⁵. This legal basis is what keeps rate setting independent of the Government of the day: no minister can order a rate change, and the committee does not answer to the Treasury for its votes.

The Government's role is limited to two things. First, it sets the inflation target the committee must aim for, which is 2%¹. Second, the Chancellor appoints the committee's four external members for fixed terms⁵. Beyond that, the Chancellor has no vote and no say in the outcome. This division of responsibilities matters to consumers because it means rate decisions are made on economic evidence rather than political timetables, and the reasoning behind each decision is published for anyone to read.

The rate the committee sets, Bank Rate, is often called the base rate, and the two names refer to the same thing. The Bank defines Bank Rate as the rate of interest it pays to commercial banks, building societies and financial institutions that hold money with it⁵. It is not a rate any household pays or receives directly, but it is the anchor for almost every other interest rate in the UK, from mortgage deals to savings accounts⁶.

Who sits on the MPC: nine members, five from inside the Bank

The Monetary Policy Committee has nine members⁵. Five of them are already employees of the Bank of England, so the Bank calls them internal members⁵. These include the Governor and the Chief Economist; the Governor appoints the Chief Economist after consultation with the Chancellor⁵.

The other four are external members, people from outside the Bank who have relevant knowledge or experience⁵. They are appointed by the Chancellor for a fixed term⁵. The mix is deliberate: internal members bring the Bank's own economic analysis, while external members bring perspectives from academia, financial markets and other fields, so the committee is not simply reviewing its own work.

Each of the nine members has one vote, and the decision is taken by majority. The votes are not always unanimous, and the split is published with the decision. In March 2025, for example, the committee voted by a majority of 8-1 in favour of keeping the rate unchanged, with one member voting for a cut to 4.25%⁷. In September 2026 the committee voted 6-3 in favour of holding the base rate for the sixth month in a row³. These splits are part of the published record, so the public can see not only what was decided but how strongly the committee was divided.

The Bank describes the members as "a group of nine people with a variety of backgrounds" responsible for setting Bank Rate¹. Their names, biographies and voting records are published by the Bank, so anyone can check who took each decision and how each member voted over time.

How a rate decision is made and announced

Each decision round follows a set pattern. The committee meets to look at the evidence and make a decision about every six weeks¹. Members consider the latest data, including inflation figures, which the Office for National Statistics publishes monthly. The Bank of England receives official statistics before the public does in some cases: it was granted exceptional pre-release access to an estimate of consumer price inflation data at 10:00am on Monday 14 September 2026, ahead of the MPC meeting that followed⁸.

The decision, together with the minutes of the meetings, is published at midday on the Thursday of the decision round⁵. The minutes record the discussion and the vote of each member. This arrangement follows recommendations made by the 2014 Warsh Review, an independent review of how the Bank communicates its decisions⁵.

The committee is not locked into its schedule. It has the power to make unscheduled changes to the base rate if it thinks it necessary⁴, although in practice rate changes almost always come at scheduled meetings. After the announcement, lenders and savings providers decide how to respond: tracker mortgages follow Bank Rate by their terms, while other rates move at each provider's discretion.

The publication of minutes and votes is what makes the process accountable. A consumer cannot influence the vote, but they can read exactly why Bank Rate moved, what the committee expected to happen next, and which members disagreed. The Bank also publishes a Monetary Policy Report alongside certain decision rounds, setting out its economic analysis and forecasts in more detail.

MPC meeting dates: eight decisions a year

The MPC makes eight scheduled decisions a year, roughly one every six weeks⁶. The Bank of England publishes the schedule of meetings in advance, so the dates of all eight decisions in a calendar year are known before the year begins. In 2025, for example, the committee had a further six meetings scheduled as of March, with the next base rate announcement due on 8 May⁷.

For 2026, the next MPC meeting is scheduled for Thursday 5 November, and the committee will then have one further meeting in December³. Decisions are announced at midday on the Thursday at the end of each round⁵.

Since 2015, the Bank has recorded the committee's second and final meetings, and it publishes transcripts of these after an eight-year delay⁵. So the public gets the decision, the vote and the minutes immediately, but the verbatim recordings of the discussion only years later. This is a deliberate balance between transparency and giving members room to speak freely.

If you are trying to time a financial decision around an announcement, the schedule is public and fixed. What is not predictable is the outcome: the committee can hold, cut or raise at any meeting, and markets, commentators and lenders all watch the same published evidence, such as the monthly inflation figures, for clues. In March 2025, attention was on the March inflation figures, released on 16 April, as a significant rise or fall could have shifted the committee's thinking⁷.

Bank Rate now: 3.75%

Bank Rate is 3.75% as of 17 September 2026¹. The Bank of England's Monetary Policy Committee has kept Bank Rate unchanged at 3.75% at its last four meetings, according to Scottish Government economic statistics published in July 2026². In September 2026 the committee voted 6-3 in favour of holding the base rate for the sixth month in a row³.

The rate did not stay still in the years before this. The committee lowered interest rates three times in 2025, from 4.75% to 4% by August 2025¹¹. Before that, it had cut twice in 2024, in August and November, from 5.25% to 4.75%¹². The current level of 3.75% therefore reflects a period of gradual reductions from the peak reached in 2023.

The Bank's own commentary gives a sense of its thinking during this period. In March 2025, the MPC concluded that "a gradual and careful approach [to reducing the base rate] is appropriate"⁷. That language, and the recurring split votes, show a committee weighing the risk of cutting too fast against the risk of holding too long.

For consumers, the current level matters because it anchors the rates on offer across the market. The Bank notes that it sets the interest rate, which impacts the cost of getting a mortgage¹³. When Bank Rate is held for several meetings, as now, lenders and savings providers tend to price their products around the expectation that the next move, whenever it comes, is likely to be small.

The 2% inflation target and why rates move

The Government sets the Bank of England a target of getting inflation to 2%¹. The measure the Government asks the Bank to target is the Consumer Price Index, or CPI¹⁴. The committee's whole purpose is to use Bank Rate to keep inflation as close as possible to that 2% target⁴.

Inflation has moved a long way in recent years. From October 2022, CPI gradually reduced to reach the Bank of England's target rate of 2% by June 2024¹⁵. It did not stay there: UK inflation rose from a low of 1.7% in September 2024 to a post-election peak of 3.8% in July, August and September 2025, before falling back slightly to 3.6% in October 2025¹⁶. The Bank of England projected inflation to peak at 3.2% in the fourth quarter of 2026¹⁷.

Why does the Bank raise rates when inflation is above target? Its explanation is that higher interest rates work because they mean less money will be spent in the UK than if rates had not changed¹⁴. Higher rates make borrowing more expensive and saving more rewarding, which cools demand, and weaker demand eases the pressure pushing prices up. The Bank describes raising interest rates as the best way it has to make sure inflation comes down and stays low¹⁴.

The catch is time. The Bank states that it takes time to work, usually up to two years¹⁴. This is why the committee votes on forecasts as much as on today's figures: a rate change made now is expected to influence inflation over the following two years, not this month. It also explains why the committee sometimes holds rates even when inflation is above target, if it believes the effects of past changes have not fully fed through yet.

The full story of the target and the mechanism is covered in the guide to the 2% inflation target, and the current numbers are in latest UK inflation figures.

How Bank Rate feeds through to mortgages, loans and savings

Bank Rate is the rate of interest the Bank of England pays to commercial banks, building societies and financial institutions that hold money with it⁵. No household deals with the Bank directly at that rate. Instead, the rate works its way through the financial system to the rates people actually pay and receive.

The feed-through is clearest on tracker mortgages and other variable-rate borrowing. A variable rate can change at any point, typically reflecting a change in the Bank of England's base rate¹⁸. So when Bank Rate falls by 0.25 percentage points, a tracker mortgage rate usually falls by the same amount soon after. Fixed-rate mortgages behave differently: they are priced against market expectations of future rates, so they can move between MPC meetings, as explained in gilt yields and fixed mortgage deals.

On the savings side, providers decide their own responses. NS&I, for example, states that its Direct ISA rate is variable and can change up or down from time to time, for example when the Bank of England base rate changes or when rates in the general savings market change¹⁹. Its Direct Saver rate is set by HM Treasury and can change from time to time²⁰. Neither is guaranteed to follow Bank Rate exactly, which is why savings rates across the market can diverge even when Bank Rate is unchanged.

The feed-through also appears in official measures of average rates. The Bank of England publishes an average mortgage rate, defined in legislation as the effective interest rate (non-seasonally adjusted) of UK resident banks and building societies for loans to households secured on dwellings²¹. This same published average is used as the standard rate for support for mortgage interest in the benefits system, in both Great Britain and Northern Ireland²¹. When that published average differs by 0.5 percentage points or more from the standard rate that applies, the standard rate is varied²¹.

The scale of the effect on households was visible in the statistics. The Bank of England base rate, which influences the rates banks pay individuals on their savings, increased from 0.75% to 4.25% during the tax year 2022 to 2023²³. Higher rates fed through to higher borrowing costs, which in turn affected household finances across the UK¹². The practical consequences for different products are covered in how a Bank Rate change affects your mortgage payments, average savings interest and typical borrowing costs.

From 0.1% to 5.25%: how Bank Rate has moved

Bank Rate has covered an extraordinary range since 2021. The Bank of England interest rate rose from 0.1% in December 2021 to 5.25% in August 2023²⁴. The ONS records the same episode as increasing the bank rate 13 times from 0.25% to 5.25% between January 2022 and August 2023²⁵, while the Scottish Government's analysis describes the Bank raising interest rates 14 consecutive times from the end of 2021 to August 2023²⁶. The small difference in the counts reflects whether the first rise, from 0.1% to 0.25% in December 2021, is included in the sequence.

The rises came in steps. The Bank raised the base rate of interest eight times in 2022 and once more in early 2023, taking it to 4%²⁷, before further increases took it to its peak of 5.25% in August 2023²⁶. At that peak, the Bank's own Financial Stability Report stated that in the UK, Bank Rate was currently 5.25%²⁸.

The direction then reversed. The Bank reduced interest rates twice in 2024, in August and November, from 5.25% to 4.75%²⁹. It then lowered rates three times in 2025, from 4.75% to 4% by August¹¹. By 2026, Bank Rate stood at 3.75%, where it has been held². The full record of past changes is in Bank Rate history.

For context, the Office for Budget Responsibility, the government's independent economic watchdog, has forecast that the base rate will stabilise in 2026³⁰. Forecasts are not guarantees, and the committee's own projections have shifted with the data: in late 2025, inflation was judged to have peaked and was projected to slow to 3.2% by March 2026¹⁶.

What the Bank of England does not do for consumers

The Bank of England is not a high street bank and does not serve the public in the way a commercial bank does. It does not offer savings accounts, investments, cryptoassets or "guaranteed returns", and it does not provide investment advice or endorsements³¹. Its staff do not endorse, promote or advertise financial products³¹. A consumer cannot open an account with it, although some commentators have proposed that it should offer simple, cheap deposit and savings accounts to all, for instance through National Savings & Investments, paying interest at Bank Rate³². That is a proposal, not current practice.

This matters because fraudsters sometimes claim to represent the Bank. The Bank states it will never contact you from personal email addresses, ask you to move money "for safety" or to "release funds", verify your identity by requesting National Insurance numbers or bank statements (unless you are exchanging banknotes with it), or contact you about unclaimed estates, refunds, fines or warrants³¹. Anyone receiving such an approach should treat it as a scam; the guide to scams and fraud covers what to do.

The Bank's work does touch consumers in other ways. It has created rules to limit the riskiest type of mortgage lending, and it tests whether the largest banks can cope with big losses from unsecured debt¹⁸. It regulates around 1,500 companies, and when cyber-risk affects one of them it works with the Financial Conduct Authority, the Treasury and the National Cyber Security Centre to co-ordinate its response, while individual banks remain responsible for protecting themselves and their customers against cyber-attacks³³. It also publishes monthly statistical data on lending to individuals, including breakdowns by type of lender and product³⁴, which is where the market averages used elsewhere on this site come from.

Two further boundaries are worth knowing. First, the Bank's decisions do not override consumer law: the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 exclude contracts for services of a banking, credit, insurance, personal pension, investment or payment nature from their cancellation rights³⁵, so a rate change is not a reason to cancel such a contract. Second, the Bank does not supervise the conduct of firms towards their customers in the way the Financial Conduct Authority does; complaints about a bank, lender or insurer go to the firm and then to the Financial Ombudsman Service, as explained in consumer protection in UK financial services.

Where the Bank's rate decisions do reach consumers, it is through the products they already hold. If money is tight after rate changes, free help is available from debt advice, and the Bank's own guidance on what to know about debt is a starting point¹⁸.