Terrance White
12
30 Oct 2022
Interest rate rises for seventh consecutive month
The Bank of England increased rates by half a percentage point to 2.25%. The interest rate has risen for the seventh consecutive month. The aim of the rise is to help slow the rate of rising prices.
Last year interest rates were as low as 0.1% and have been low since the global financial crisis of 2008.
The increase will be a pain for homeowners with a mortgage or potential buyers looking to get on the property ladder as the cost of lending will increase with any Bank of England rate rises.
Rates will rise further to help lower the rate of inflation. Indications are there will be further rate rises towards the end of the year and in early 2023.
People on a fixed mortgage can breathe a sigh of relief as they will not be affected immediately but need to budget for when the fixed rate ends. Other mortgages will include variable rate and trackers which will see an increase in mortgage payments.
The Bank of England has a monetary policy committee which basically is a team of nine economists who decide what the rates will be. They meet eight times throughout the year approximately every six weeks to look at how the economy is performing.