According to the Bank of England, the UK base interest rate is anticipated to rise from early May as an approach to counteract increasing levels of inflation. Interestingly, city investors advocate a 75% probability of an interest rate rise from May 2018; having previously suggested a 50% possibility. This suggests the cost of borrowing will likely to become more expensive from May 2018, whilst savers will take advantage of the interest rate hike. However, rising levels of inflation will offset this benefit to savers.
Worryingly, the rise of UK interest rates would impact millions in the UK; particularly low-income families who rely on cheap credit to get by financially. The current British Bank governor, Mark Carney, advocates increasing average wages and the resilient growth of the UK’s GDP are indicators for the need to increase UK interest rates – which currently stands at 0.50%.
With these points in mind, if you’re seeking to borrow credit, now is the time to secure them (if you can afford the repayment) at fixed rates before the interest rate hike anticipated from May 2018.
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