Despite speculation to the contrary, the Bank of England has announced today that interest rates will remain at 0.25%.
The decision comes one year after the Monetary Policy Committee’s (MPC) historic rate cut and was the result of a 6 – 2 vote by the MPC.
The fact that predictions for economic growth have been downgraded to 1.7% this year, compared to previous estimations of 1.9%, are said to have influenced the outcome of the vote.
Next year’s growth expectations have also been revised down from 1.7% growth to 1.6%.
Jeremy Duncombe, Legal & General Mortgage Club director said:
“These historic lows won’t last forever, particularly as inflation starts to creep upwards. A base rate rise this year, whilst not a certainty, is possible. Consumers should take the opportunity to get in touch with their adviser now, so that they can review their existing mortgage arrangements.
Time is of the essence to secure a new deal, which could potentially save them thousands of pounds, before interest rates inevitably rise again.”
Richard Sexton, e.surv director added:
“… with the current political and economic uncertainty, it is not a question of if, but when will rates eventually rise. It’s interesting to consider that for many current mortgage holders, they have never experienced a rate rise and the impact of any payment shock is unknowable at this time.”
ANY PROPERTY USED AS SECURITY, WHICH MAY INCLUDE YOUR HOME, MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
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