Some mortgages set to rise ‘by £600 a year’ after Bank of England hikes interest rates to 4.5 per cent
The latest increase in interest rates is set to make life even more difficult for people on variable mortgages and some people with credit cards and overdrafts.
Announcing the decision to hike rates again, the Bank's MPC said there had been "repeated surprises about the resilience of demand" and that inflation had been stronger than expected as the price of food and other goods were higher amid the war in Ukraine.Picture:The two members of the MPC who wanted to keep rates unchanged said that inflation was already expected to fall considerably this year without the need to rise the rate again.
They said: "The committee judges that growth over much of the forecast period will be materially stronger than in the February report. "But unless we tackle rising prices, the cost of living crisis will only carry on - which is why we need to be resolute in sticking to our plan to halve inflation by the end of the year."They now expect that gross domestic product will not fall during a single quarter this year, meaning the economy is not set to decline and the UK could avoid a recession.
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