Strong Market Expectation for December Rate Cut
Financial markets are heavily anticipating a rate cut from the Bank of England in December, with a high probability (90-94%) priced in for a quarter-point reduction. This sentiment has been reinforced following recent economic data and the Autumn Budget announcements.
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Will The Bank Of England Cut Interest Rates On 18 December?
The Bank of England is widely predicted to cut interest rates at its next Monetary Policy Committee meeting on 18 December 2025, with markets pricing in a 90% chance of a quarter-point reduction from 4% to 3.75%. These odds are up from the 85% chance of a cut in the week before Chancellor Rachel Reeves delivered the Autumn Budget on 26 November 2025.
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HL Live | Financial Market Events and News (Autumn Budget 2025)
The FTSE opened up around 0.25% this morning, taking it about 2% higher than when the week started, with the Chancellor delivering what was widely seen as a fiscally responsible Budget. Gilt yields remain below where they were on Monday, a sign of growing trust by those who lend to the Treasury. The market’s now pricing in a 94% chance of a quarter-point cut by the Bank of England next month.
General Mortgage Rate Trends and Market Sentiment
Overall UK mortgage rates are showing a downward trend this week, influenced by weaker labor market data and a prevailing sentiment among some experts that rates will continue to drop. However, a significant portion of analysts also anticipates rates remaining flat in the short term, with global economic factors influencing the broader outlook.
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Mortgage Rate Trends And Predictions For Nov. 26 – Dec. 3, 2025
Mortgage rates are moving down this week as the latest economic data shows signs of a weaker labor market. In addition, consumer confidence is now at the lowest level since April. Of those polled, 30% of respondents say rates will drop and 50% predict rates will stay flat for the week of Nov. 26 – Dec. 3, 2025.
