Base Rate Increase
The Bank of England (BoE) has increased the base rate level of interest to 4.5%, the 12th consecutive increase.
Highlights:
- Inflation is too high. It has been around 10% since mid 2022.
- The BoE has raised interest rates to make sure inflation falls and stays low.
- They expect inflation to fall quickly in 2023, meeting the ongoing target of 2% by late 2024.
What Does This Mean?
This change will likely result in an increase in mortgage payments for millions of borrowers on variable rate mortgages as lenders react to the announcement. Those on fixed rate mortgages will be unaffected at this time, with payments remaining the same until their deal ends, however they may see an increase in their repayments when it comes to finding a new deal in the future.