The Bank of England is anticipated to announce an increase in interest rates from 3.75% to 4% on Thursday, marking the first hike in over three years. This change is expected to raise borrowing costs for individuals and businesses while potentially benefiting savers. Inflation has been rising, influenced by various factors including energy costs, and the central bank aims to balance this against a weakening economic growth outlook.
The impact of the rate increase will be felt by many mortgage holders, particularly those on tracker and variable deals, with potential increases in monthly repayments. The decision will also affect future mortgage rates for those looking to remortgage, as lenders adjust their offerings in response to the anticipated change.