However the ‘hold’ decision was far from unanimous. The rate-setting Monetary Policy Committee voted in a 6 to 3 split in favour of holding the rate. Three members preferred to reduce the bank rate by 0.25 percentage points to 4%.

Chetwood Bank chief executive Paul Noble said the BoE’s hold decision was the cautious choice, and argued that good leadership meant more than playing it safe.

“The MPC’s decision will be welcomed by some, but it’s another example of cautious drift over clear direction. Holding their ground may make sense given chaotic global pressures, but it’s not the decisive leadership our economy needs.

“The economy has been through the ringer, with the Chancellor’s plan providing domestic pressures to add to those caused by the US, Russia, and beyond. However, the central bank continues to act as though inflation is the only variable that matters.”

He went on to say that the MPC’s lack of action piled greater uncertainty on mortgages as well, leaving would-be buyers in the lurch.

“This cautious approach could lead to greater paralysis when what markets need is a catalyst.”

Future rate path

Morgan Ash managing director Andrew Gething stressed that while the decision was far from a surprise, it demonstrated just how quickly the conversation has changed around the future path of interest rates.

“After last month’s cut, the view was there was much more to come. The consensus is still downward, but bold predictions of as many as three more cuts this year now seem pie in the sky. As is often the case, fierce inflation has caused traders to scale back their predictions, proving that plotting the future path of interest rates can still be a fool’s errand.”

LRG group financial servic es managing director Tom Davies said he did not expect the property market to be negatively impacted by today’s decision.

“Mortgage rates are in the 4% range, with ‘best buys’ starting with a 3, which, in historical terms, is healthy. Lending criteria is beginning to loosen on affordability and we are seeing increased appetite from lenders.

“Perhaps most importantly, stock levels are approximately 12% higher than this time last year, compared to buyer demand, up by 3%. This combination creates significant opportunity – for buyers and sellers.”

He added that while there was always a temptation for buyers to wait for the next rate cut, in practice the impact of a lower mortgage rate could be offset by rising prices if stock tightens again. “We’ve seen it many times before: confidence returns, stock shrinks and prices climb.”

How many cuts and when?

Butterfield Mortgages chief executive  Alpa Bhakta said: “ “Even if UK inflation runs above the 2% target, there remains a real possibility that we’ll see the base fall later this year – the question is how many cuts, and when will they come. For now, the lending sector must respond to today’s decision by doubling down on support for both brokers and investors.”

Market Financial Solutions chief executive Paresh Raja pointed out that when it cut the base rate in early May, the MPC strongly indicated that further cuts would follow. But economic and political landscape, both in the UK and globally, continues to evolve at pace – pronounced turbulence and uncertainty made the hold today almost inevitable.

“But we should see the bigger picture: the base rate is 0.75% lower than it was ten months ago, and a gradual decrease is still expected in the coming year. The challenge right now is to ensure inertia doesn’t set in within the property market while would-be buyers wait for further cuts; we have to unlock buyer demand right now.”

He added that lenders could not afford to dwell on decisions from Threadneedle Street and should focus on what they can control.

“With the prospect of multiple rate cuts in the second half of this year now fading, it’s vital that lenders continue to adapt their products and offerings in line with borrowers’ needs. If they can do that, investors should have the confidence to execute their plans, helping to unlock activity across the market despite the higher-rate environment.”