Thursday 11th January 2007
The Bank of Englands monetary policy committee (MPC) has decided to raise the base rate to 5.25 per cent, it has been revealed.
Analysts may be surprised at the move, which was predicted by only one in 50 financial experts surveyed in a recent Reuters poll.
Many had predicted that rates would be held at five per cent until at least February, in order for the MPC to assess new-year wages and consumer spending power.
The year-on-year rise now stands at 0.75 per cent following previous increases of a quarter of a percentage point in August and November.
Prior to that, rates had been maintained at 4.50 per cent for a 12-month period.
Research from GE Money Home Lending this week found that intermediaries for mortgages cited rises in the base rate as a key concern for the coming year.
Gerry Bell, head of mortgage marketing at the firm, said that a base rate rise was seen by 80 per cent of intermediaries as having an effect on future growth of the mortgages market.
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