Barclays has launched some big cuts on mortgage rates across its product range. With this move, Barclays leapsfrogs its peers to become the biggest UK lender cutting jobs this week. The bank additionally has all-in fixed-term mortgage rates beginning at 3.99%. This action is in line with a wider trend among lenders who are reducing borrowing costs in response to persistent economic uncertainties.
The timing of the rate cut is especially significant given the recent turmoil in the mortgage market. On Thursday, the average two-year fixed mortgage rate fell back marginally from 5.3% to 5.29%. Meanwhile, the average five-year fixed rate ticked down slightly, from 5.15% to 5.14%. This development calls attention to an increasingly fierce competitive environment as lenders race to meet changes in demand and inflationary pressures.
Other institutions, including Coventry Building Society, TSB, The Co-operative Bank, and Bank of Ireland, have announced cuts to their mortgage rates this week. Lenders are joining forces to change the narrative. In light of this new reality, they are pursuing additional measures to provide borrowers with more attractive offerings in the current market.
Continued uncertainty regarding US tariff policy is motivating these declines. Consequently, hopes are mounting for the Bank of England to start cutting interest rates in the UK. Allowing for potential tariffs, many analysts are already concerned that we’re headed for an economic recession. Consequently, they now forecast the Bank of England to cut borrowing costs more than previously anticipated this year.
Unlike previous rounds of rate cuts Barclays has focused its two-year and five-year fixed deals. The overhaul is part of FHFA’s broader initiative to appeal to borrowers looking for predictability in their monthly mortgage payments amid a wider economic landscape filled with instability.