National rates of interest rise for the fifth time
In what has commonly been referred to as an unsurprising outcome, the Bank of England today announced that interest rates are set to rise by a further ¼ of a percent, placing the national rate of interest at a high of 5.75%.
Many analysts have speculated that a further rise in interest for the month of July was inevitable, following on from the disclosed outcome of a previous meeting in June, where the proposed increase of a ¼ of a percent was only marginally dismissed.
It is suggested that the committee’s reasons for agreeing to the increase this time round are two fold. Although considerably less substantial than previous months, the continued growth of the housing market is the first factor attributed to the rise, with the second being attributed to a minor reduction in the national rate of inflation. The bank has also announced that its proposed inflation target of 2% has already been surpassed by around half of a percent.
For consumers, the rise has been most unwelcome. Experts suggest that the average monthly home loan repayment is likely to rise by around 30-50 pounds. For many consumers who are still coming to terms with the last increase, this further rise could prove to be the final blow. Numerous charities and consumer interest groups have already reported a sharp increase in the number of people seeking financial help with regards to their home loan repayments and other secured credit commitments.
It is almost unanimously agreed that the further rise in interest is pushing the boat to far. Analysts suggest that the economy has still to feel the full effects from the last rise and today’s news is likely to send shockwaves through the markets, with the housing market in particular. However, the biggest concern for many is the likelihood of a further ¼ percent increase in the not too distant future.
