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Looking after your future

81a High Street, Teddington, Middlesex. TW11 8HG

TELEPHONE: 0208 977 0055

Base Rate 0.75%

Base Rate 0.75%

Base Rate and Fixed Rate Increases

WHY:  Raising interest rates – to encourage people and firms to borrow and spend less, or to save money – is one of the tools it uses to limit inflation. Prices are now rising quickly in the UK and around the world, as Covid restrictions ease and consumers spend more.

WILL RATES CONTINUE TO INCEASE:  They may need to increase interest rates further in the coming months. But that all depends on what happens in the economy. In particular, they will be watching closely what is likely to happen to the rate of inflation in the next year or two.

They review how the economy is doing and whether a change in interest rates is needed eight times a year (roughly every six weeks).

FIXED RATES: There has been a large increase in rates from lenders and this is mainly down to the increase in Bank Base Rate but also because the banks and building societies have been swamped with business and can not cope with the levels of business. The 2 and 5 year fixed rates are very similar currently starting at roughly 2%. If the market slows, we can expect the margins to reduce and rates to become more competitive.

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