BoE: Interest rates could rise sixfold in next three years

Interest rates set by the Bank of England could rise by six times the current rate of 0.5 by 2017, according to the bank’s Governor Mark Carney.

A rise in the rate to 3% would be welcome news for many savers who have seen a scant yield from their savings in recent years, but will be bad news for borrowers who will see a sharp rise on interest payable on loans.

Mortgage brokers are expecting to see an influx of homeowners wishing to fix their mortgages at current interest rates.

The news comes as Britain’s economy is expected to grow at the fastest rate in the developed world.

Carney said that the recovery means that by around 2017, the bank rate will settle somewhere between 2 and 3%.

“When the time comes — a welcome time — to raise rates, we expect it to be gradual, and the degree to be limited,” he said.

Interest rates have remained at 0.5% since 2009 in order to stimulate borrowing in the weak economy.

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Readers' comments (1)

  • Anonymous

    This is not going to happen as it is not politically correct nor the timing right without having economic repurcussions

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