The Bank of England has held base rates at 3.75% again.

The Bank’s Monetary Policy Committee (MPC) said: “Protracted conflict in the Middle East has contributed to further increases in crude and refined energy prices since the previous meeting, which remain more volatile and higher than pre-conflict. UK CPI inflation increased to 3.1% in August and is likely to rise further over coming quarters. Monetary policy is being set to ensure inflation comes down to 2% sustainably as the economy adjusts to the energy shock. The policy stance required to achieve this will depend on the scale and duration of the shock and how it propagates through the economy.”

The base rate impacts what banks and lenders charge borrowers and investors, hence why it can be so important to the commercial property market. Changes to interest rates can have a direct impact on values and market activity. When interest rates rise, alternative means of investment can become more attractive when compared to commercial property investment yields.

It is not just investors but occupiers who will also feel the effect of interest rate rises. If the cost of borrowing increases, this can increase their overheads impacting growth or contraction and their demand for premises. The general mood seems to be that interest rates will rise at some point in the near future and the next few months economic and market activity will go along way to influencing this.