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Mortgage payers face more pain after the Bank of England\u2019s chief economist warned interest rate setters must \u201csee the job through\u201d if soaring inflation is to be reined in.<\/p>\n
The Bank has already raised its base rate 14 times in a row. A typical new mortgage had a rate of 4.66 percent in July, up from 2.33 percent a year earlier.<\/p>\n
Lewis Shaw, mortgage expert at Shaw Financial Services, said another hike would be \u201cabsolutely crazy\u201d.<\/p>\n
He said: \u201cAfter everything that households and businesses have been through the past few years, this is the icing on the cake. It\u2019s tantamount to kicking the country when we\u2019re on our knees.\u201d<\/p>\n
Riz Malik, director at R3 Mortgages, accused the Bank of \u201cfailing the British public with every rate rise\u201d.<\/p>\n<\/div>\n
He added: \u201cThe only thing more hopeless is the Government, whose \u2018sit back and do nothing\u2019 approach towards the economy is shameful.\u201d<\/p>\n
Huw Pill, the Bank\u2019s chief economist and a member of its Monetary Policy Committee, which sets the base interest rate, told a central banking conference in South Africa tackling inflation is the institution\u2019s priority.<\/p>\n
He pointed out: \u201cThe key element is that we on the MPC need to see the job through and ensure a lasting and sustainable return in inflation to the 2 percent target.<\/p>\n
\u201cHolding rates high for longer, but in a more steady, resolute way is the best way to vanquish inflation. There is the possibility of doing too much and inflicting unnecessary damage on employment and growth.<\/p>\n
\u201cBut at least in my personal view, at present the emphasis is still on ensuring that we are sufficiently restrictive for sufficiently long to ensure that we have that lasting return to target.\u201d<\/p>\n<\/div>\n
The MPC has steadily raised rates from 0.1 percent in December 2021 to 5.25 percent. It is expected to vote for another hike at its next decision on September 21. Inflation has eased back to 6.8 percent from a peak of 11.1 percent last October but is still far from the Bank\u2019s target.<\/p>\n
Michelle Lawson, mortgage adviser at Lawson Financial Ltd, said: \u201cIt\u2019s about time the \u20182 percent dream\u2019 is put aside for a moment.<\/p>\n
\u201cThere are far too many other reports warning of how damaging these rate rises are for the general
public, business and the economy
as a whole.\u201d<\/p>\n
Higher interest rates take between 18 and 24 months to impact the economy. They have added hundreds of pounds a month to the mortgage repayments of homeowners and this has slammed the brakes on the
housing market.<\/p>\n<\/div>\n
Meanwhile, the Financial Conduct Authority says it is analysing information provided by nine banks and building societies on the value offered by their savings products.<\/p>\n
It follows the introduction of the Consumer Duty last month, which requires firms to ensure products and services deliver fair value to their\u00a0customers and act if they do not.<\/p>\n
The City regulator said it will now analyse the information provided by the organisations and will publish an update later this autumn.<\/p>\n<\/div>\n[ad_2]\n","protected":false},"excerpt":{"rendered":"
[ad_1] Mortgage payers face more pain after the Bank of England\u2019s chief economist warned interest rate setters must \u201csee the job through\u201d if soaring inflation is to be reined in. The Bank has already raised its base rate 14 times in a row. A typical new mortgage had a rate of 4.66 percent in July, …<\/p>\n","protected":false},"author":1,"featured_media":5955,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"_links":{"self":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/posts\/5954"}],"collection":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/comments?post=5954"}],"version-history":[{"count":0,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/posts\/5954\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/media\/5955"}],"wp:attachment":[{"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/media?parent=5954"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/categories?post=5954"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/farratanews.online\/wp-json\/wp\/v2\/tags?post=5954"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}