Interest rates
Bank Rate raised to 4%: what it means for your savings
The Bank of England raised Bank Rate from 3.75% to 4% on 5 November 2026. How the rise reaches easy access, notice and fixed accounts, with the sums shown.
Bank Rate went up on Thursday, from 3.75% to 4%. I check savings rates every day, so here is what the rise means for money you already hold, and what a quarter of a point is worth in pounds.
Bank of England raises Bank Rate to 4%
The Bank of England's Monetary Policy Committee (MPC) raised Bank Rate by 0.25 percentage points, from 3.75% to 4%, at its meeting ending on 4 November 2026. The decision was announced at 12:00 on Thursday 5 November 2026.
The vote was 8–1. Eight members voted for the 0.25 point rise. Catherine L Mann voted against, preferring a rise of 0.5 percentage points to 4.25%. At the previous meeting, in September, the Committee held Bank Rate at 3.75%.
The Committee said global energy prices had continued to rise, and that the inflationary pressure in the pipeline was now enough to warrant an increase. CPI inflation was 3.5% in the 12 months to September 2026, up from 3.1% in August, against the Bank's 2% target. The Bank's own projection, published with the decision, has CPI inflation rising to around 5% by the middle of 2027. We report that projection; we don't make our own.
When will my savings rate go up?
- Easy access and other variable accounts: the bank can raise the rate at any time. Some pass on the full 0.25 points, some part of it, some none. Changes are often announced in the days and weeks after a decision, with an effective date that can be later still.
- Tracker accounts: these are linked to Bank Rate in their terms, so they move by the stated margin, usually from a set date after the decision.
- Notice accounts: usually variable, so they work like easy access, with notice needed to withdraw.
- Fixed-rate bonds and fixed-rate ISAs: the rate is locked for the term, so Thursday's decision doesn't change a fix you already hold. New fixed deals are priced from market rates, which already reflect what traders expect Bank Rate to do, so they can move before and after a decision, in either direction.
- Regular savers and accounts with a bonus: check the terms. A bonus usually stays the same, and only the underlying rate may change.
Banks aren't required to pass a Bank Rate rise on to savers. Each bank decides whether to change its rates, by how much and from when. What happens next depends on the type of account.
What a 0.25 point rise is worth in pounds
| Balance | Full rise passed on | Half the rise passed on |
|---|---|---|
| £5,000 | £12.50 | £6.25 |
| £10,000 | £25 | £12.50 |
| £20,000 | £50 | £25 |
| £50,000 | £125 | £62.50 |
| £85,000 | £212.50 | £106.25 |
On a variable account, a 0.25 point rise adds your balance × 0.25% to a year's interest. On £20,000: £20,000 × 0.25% = £50 a year, or about £4.17 a month.
If your bank passes on only half the rise, 0.125 points, the gain halves: £20,000 × 0.125% = £25 a year. If it passes on none, your interest doesn't change.
These figures are before tax. Interest in a cash ISA is tax-free. Outside an ISA, interest above your Personal Savings Allowance is taxed, so you'd keep less of the rise; the savings tax calculator shows how much.
Savings rates against 3.5% inflation
With prices rising 3.5% a year, what your savings can buy grows only if your rate is above 3.5%. The real return is (1 + rate) ÷ (1 + inflation) − 1. The rates below are made up for illustration, not ones on offer.
At 4.50%: 1.045 ÷ 1.035 − 1 = 0.97% a year. £20,000 grows to £20,900, which is £20,900 ÷ 1.035 = £20,193 in today's money, a real gain of £193.
At 4.00%: 1.04 ÷ 1.035 − 1 = 0.48% a year. £20,000 grows to £20,800, which is £20,800 ÷ 1.035 = £20,097 in today's money, a real gain of £97.
At 2.00%: 1.02 ÷ 1.035 − 1 = −1.45% a year. £20,000 grows to £20,400, which is £20,400 ÷ 1.035 = £19,710 in today's money, a real loss of £290.
These sums assume inflation stays at 3.5% for the whole year and ignore tax. The next inflation figure, for October, is due from the Office for National Statistics on 18 November 2026.
Fixed or variable after a rise
An illustration with made-up rates, not ones on offer: £20,000 for one year, either fixed at 4.25% or left in a variable account paying 4.00%. Simple interest, before tax.
Fixed: £20,000 × 4.25% = £850, whatever Bank Rate does next.
Variable, if the rate stays at 4.00%: £20,000 × 4.00% = £800, which is £50 less than the fix.
The variable account would pay more than the fix only if its rate rose far enough, soon enough. It also lets you withdraw; a fix usually doesn't. Which matters more depends on your own circumstances.
What to check on your own accounts
- The rate you're paid now, from your statement or the bank's app. Older accounts often pay less than ones on sale today, and a rise doesn't change that gap.
- Whether each account is variable, tracker or fixed, and when any fix or bonus ends.
- Any message from your bank in the coming weeks about a rate change, and the date it takes effect.
- How much you hold with each banking licence, against the £120,000 FSCS limit, if a higher rate draws you to move money.
Juno Hunt's rate changes page lists rises and cuts as banks make them, and My savings tells you when the rate on an account you hold changes.
The next Bank of England decision dates
The MPC next announces a decision on Thursday 17 December 2026, then on 4 February, 18 March, 29 April and 17 June 2027. Andrew Bailey, the Governor, said the rise shouldn't be seen as the first in an inevitable long sequence, but that unless the conflict in the Middle East is resolved it doesn't seem likely to be the last. The Committee said it will judge the outlook at each meeting. We'll set out what changed for savers after each decision.
About this article
Bank Rate, the vote, the Bank's inflation projection and the decision dates are from the Bank of England; inflation is from the Office for National Statistics, as at 6 November 2026. The worked examples use illustrative rates, not rates on offer.
This is general information, not advice: it doesn't take your circumstances into account. Rates and rules can change; the sources below are where to check.
Sources
- Bank of England: Bank Rate increased to 4%, November 2026 Monetary Policy Summary and Minutes
- Bank of England: Interest rates and Bank Rate, our latest decision
- Bank of England: Monetary Policy Committee dates for 2026 and 2027
- Office for National Statistics: Consumer price inflation, UK, September 2026
No bank pays us today. If we agree fees with banks in future, a fee will never change the order. Nor would it change what we write.