Economy

Interest rates up for first time since 2007

Interest rates up for first time since 2007

Mr Carney also said he "expected" banks to change savers' rates accordingly.

The Bank of England and its Governor, Mark Carney, will be sitting back for the next few months to see what impact the latest move has on the rest of us, on how much we spend this Christmas, or whether we step back from those big decisions on buying a new auto or a new home.

It's hiked interest rates to curb inflation caused by a steep drop in the pound's value.

She would still recommend to clients thinking about borrowing to lock into a fixed-rate mortgage given this is likely the first of several gradual increases to the base rate, she said.

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Thousands of homeowners here in Liverpool, those on standard variable rate or a tracker rate, will now face higher mortgage interest payments but John-Paul Dennis, partner at Kirwans law firm, doesn't expect to see a major impact on the Liverpool property market at large.

Ben Broadbent told the BBC that the rate rise announced on Thursday was "moderate", and that interest payments on debt were still at record lows.

Bank governor Mark Carney signalled on Thursday that rates were likely to rise twice more over the next three years. It's not quite so directly associated with the bank rate as mortgages are.

On the rates decision, Chancellor Philip Hammond tweeted: "Our economy is strong and resilient, supported by independent monetary policy and stable prices from the Bank of England".

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The Bank of England has raised interest rates today for the first time in more than ten years. The Bank estimates that 1.5 per cent of households - about 390,000 - have mortgages that cost more than 40 per cent of their monthly pre-tax income. My concern is the impact a rise in interest rates will have on those who are just about managing.

Asked if households - already seeing inflation outpace wage growth - would suffer some "pain" from the rate rise, Mr Broadbent agreed they would.

Recent figures showed the average amount of debt per person was now £8,000 - not including mortgages, he said, and around a quarter of people said they were struggling.

"The time has come to ease our foot a little off the accelerator", Bank governor Mark Carney said.

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However Robert Gardner, chief economist at Nationwide Building Society, said consumers need not panic about further rises just yet.