Base rate remains unchanged
The Bank of England’s Monetary Policy has kept the base rate frozen at 0.5 per cent for the twenty-first consecutive month. However, there has been a growing feeling that this may not remain the case for much longer. Only recently have base rates remained at such low levels. In recent memory, it was as high as 10 per cent, and peaked in 1986 at 12.5 per cent: fantastic news for people with savings, but potentially problematic for people with mortgages or loans. Business development director at Gocompare.com, John Miles, says: “Inflation is historically a good way to see which way interest rates are going to go. If it’s on the increase, as it is now, then it’s within the realms of possibility that the Bank of England may increase rates to bolster the economy. But although inflation is rising, it’s not the Bank of England’s top priority at the moment, so unless there’s a change in attitude, rates will probably stay the same for a while longer. “With change potentially on the horizon, now may be a good time to consider a fixed-rate mortgage or loan at a low rate,” reckons Miles.