Looking Ahead to 2026: Steady Ground, Thoughtful Leadership

2025 was a busy and important year for many organisations, and particularly for us at Monmouthshire Building Society, where we began a transformation programme designed to ensure the mutual is well placed to grow and thrive for the next 150 years.

As we look ahead to 2026, there is a sense that the economic environment may begin to feel more settled after several years of volatility. While challenges undoubtedly remain, a few indicators point towards a welcome period of steadier ground.

Several forecasts suggest that inflation may continue to ease, potentially moving closer to the Bank of England’s 2% target, and interest rates could gradually return to more sustainable levels following the reduction at the end of December. That said, the UK economy remains finely balanced, and businesses will need to continue navigating uncertainty with care.

The UK Budget offered little in the way of major surprises, reinforcing the ongoing need for fiscal responsibility. In Wales, attention will also turn to the Senedd elections in May. As always, political change can bring both opportunity and uncertainty, and the outcome will inevitably have a knock-on effect on Welsh business and the wider economy. For organisations across Wales, this underlines the importance of staying focused on fundamentals, whatever the external backdrop.

As a Building Society, we must balance opportunity and uncertainty with clarity, resilience, and long-term thinking. Our responsibility is to evaluate economic change carefully and manage its impact for the benefit of our business, our colleagues and, most importantly, our customers. With growth expected to remain modest and households continuing to adjust after several years of increased living costs, maintaining financial resilience remains essential – not only for financial institutions, but for businesses of all sizes.

Turning to the property market, there are signs that greater stability may emerge during 2026 in both Wales and the wider UK. Forecasts point to modest house price growth and the possibility of mortgage rates easing if inflation continues its downward trend. Taken together, this could begin to improve affordability in some regions and offer renewed confidence to first-time buyers. While activity is unlikely to return quickly to pre-pandemic levels, a gradual recovery would be very welcome.

A more stable property market would also support the wider economy. Increased housebuilding activity creates jobs directly within construction and indirectly across supply chains, reinforcing the close connection between housing, employment and economic confidence.

Beyond the immediate economic and political landscape, the financial services sector continues to evolve. Two areas we are watching closely are the development of artificial intelligence and the ongoing impact of Consumer Duty. Technology will undoubtedly play a growing role in shaping customer expectations and service delivery. However, judgement, culture and accountability remain the true differentiators, particularly in a sector built on trust.

Consumer Duty, introduced by the Financial Conduct Authority, reinforces the principle of putting customers’ needs first – something that has long been embedded in the mutual model. At Monmouthshire Building Society, this is reflected in how we serve customers across branches, digital channels and telephone services. The work undertaken this year to better support vulnerable customers is something I am particularly proud of, and it will remain a priority as expectations continue to evolve.

2025 was a pivotal year for Monmouthshire Building Society, laying strong foundations for the future. As we move into 2026, the focus shifts firmly to delivery – turning plans into action in a way that strengthens the business, increases trust and our long-term value.

Economic conditions will continue to influence how businesses and households’ plan. As a mutual Building Society with more than 156 years of history, our role is to support our savings, mortgage and commercial customers year in year out and through each phase of the economic cycle, just as we always have – with care, consistency and a long-term commitment to the communities we serve.