How the War in Ukraine Could Impact UK Interest Rates in 2025

The ongoing war in Ukraine continues to have significant economic repercussions worldwide, including in the UK mortgage market. Since the conflict began in 2022, global energy prices, supply chain disruptions, and geopolitical uncertainty have contributed to inflationary pressures, prompting the Bank of England to raise interest rates to counteract rising costs. While inflation has started to stabilise, the war's impact on energy markets and global trade could still influence future rate decisions.

If geopolitical tensions escalate or new supply chain disruptions emerge, inflation could rise again, forcing the Bank of England to delay or slow down expected interest rate cuts in 2025. On the other hand, if global economic conditions improve and inflation continues to ease, mortgage rates may become more affordable for UK borrowers. For homebuyers and those looking to remortgage, staying informed and seeking expert mortgage advice is crucial in navigating these uncertain times. At AF & Associates Ltd, we can help you understand how market changes affect your mortgage options—contact us today to discuss your best strategy.