Martin Lewis has shared how the newly announced Bank of England interest rate of 4.5 per cent will impact on people with savings or a mortgage. The Bank increased the base rate for the 12th time in a row, taking it to the highest level since 2008.
The Bank said UK inflation is expected to fall slower than previously thought as food prices have stayed higher for longer than expected, partly due to Russia’s war in Ukraine and poor harvests in some European countries, ramping up the cost of living for households across the country. Inflation is still expected to drop sharply from April this year, as energy prices decline and household bills are subsidised.
In a post on Twitter to his 2.2 million followers, the founder of MoneySavingExpert.com explained that variable/tracker rate repayment mortgages will rise by around £12 per month (£150 per year) per £100,000 of borrowing. He added that existing fixed-rate mortgages won't change.
