The decision

On 30 July the Monetary Policy Committee held the base rate at 3.75%, voting 6 to 3. Megan Greene, Catherine Mann and Huw Pill all preferred an increase to 4%. Notably, that is one more hawk than the 7 to 2 split in June, and once again not a single member voted for a cut.

The Committee cited a June CPI outturn of 2.6% and said inflation was expected to rise further this year from the direct and indirect effects of higher energy prices. The majority judged that current financial conditions were restrictive enough to wait for more evidence. The three dissenters took the view that inflation has now been above target for more than five years and that the risk of second-round effects in pay and prices grows the longer energy costs stay elevated.

Read the direction, not the decision

The headline has not changed since May. The balance of the vote has, and it has shifted toward tightening at each of the last two meetings. The Committee also said explicitly that risks to the inflation outlook are tilted to the upside of its central projection.

A committee drifting hawkish is not about to deliver the cuts that were being priced in during the spring.

What it means for buy-to-let

  • The cuts assumed in spring underwriting are gone. Anyone who modelled a 2026 acquisition on two further reductions this year should rerun it now, before a product expiry forces the question.
  • Fixed pricing follows swaps, and swaps follow this. A held base rate alongside three votes for a rise is a poor backdrop for the lender price war that has been trimming fixed rates since May.
  • Energy is the variable to watch, not the vote. The Committee has put higher energy costs at the centre of its reasoning, which makes the inflation path, and therefore your debt cost, largely an energy question for the rest of the year.

How we are underwriting it

We have not assumed a cut in any underwriting this year and we are not starting now. Every deal is stress-tested at current rates, and we continue to favour assets where rental income covers the debt without needing rate relief. The next decision is on 17 September. We would treat a hold as the base case and a rise as a genuine possibility rather than a tail risk.

The bottom line

Three holds in a row, with the hawks growing at each meeting and nobody voting to cut. Price your debt off today's curve, keep some headroom on cover ratios, and stop waiting for cheaper money to rescue a marginal deal.