When is Bank of England's next interest rates announcement and what to expect as inflation falls

Interest rates are currently at their highest level since 2008 after the Bank of England hiked the base rate up to 5 percent in June. The huge 0.5 percent increase was made in a bid to bring inflation down towards the 2 percent target set by the Government.

Despite putting increased pressure on homeowners who have since seen their mortgage rates soar, the Bank's decision to raise interest rates 13 consecutive times has now resulted in inflation falling to a rate 'lower than expected'.

The Office for National Statistics (ONS) has revealed that the Consumer Prices Index (CPI) fell to 7.9 percent last month, down from 8.7 percent in May - which is its lowest rate since March 2022 - which comes as food price inflation eased and fuel prices dropped sharply year-on-year.

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The lower inflation rate comes as a welcome surprise as most economists had expected the figure to fall to 8.2 percent in June.

Ahead of the Bank of England's next Monetary Policy Committee (MPC) meeting, homeowners are now being offered hope that interest rates may not need to rise as high as initially feared.

The next decision on interest rates is coming in just over two weeks' time. The MPC meeting will take place on Thursday, August 3, and the decision will be announced immediately after.

Financial experts initially expected interest rates to peak between 5.75 percent and 6 percent by the end of the year, but after the bigger-than-expected fall in inflation, they now say the Bank could opt for a smaller increase of 0.25 percent.

This gives a glimmer of hope for under-pressure mortgage borrowers, who have seen rates on fixed deals soar to 15-year highs in