For the first time in many years the Bank of England has begun to hint that it may raise the base rate in the very near future., with many commentators suggesting it will be in November. The Bank of England has suggested that inflation is now at a point where it must be dealt with as it hovers around the 2.9% mark.-Alistair Murdoch
.For borrowers this will hurt a little although the bank has suggested that any rate rises will be small and gradual. It did of course cut the base rate after the Brexit referendum so this will be returning it to its pre-Brexit levels. The rate rises will affect offerings from lenders however we have just seen 2-year fixed rates below 1% recently and 5 year fixes at extraordinarily low levels! Therefore now is an opportune time to grab these rates while they are still on offer!
Lenders are also offering free standard valuations and in some cases free standard legal fees so there has not been a better time to re-mortgage!
.For savers it will present some joy in an otherwise depressing world of derisory returns on cash. Currently savers are struggling to beat inflation meaning in real terms they are losing money. Meanwhile the Stock Market has had its ups and downs but it has still provided far greater returns than cash over the last seven years. For long term investors, unless interest rates rise significantly, cash will remain the haven of the very risk averse.
An Interest Rate Rise?
by Aurora Financial — Posted on August 21, 2017