Money markets indicate the Bank of England could wait as late as November before it begins to reduce borrowing costs.
Swap rates – the main pricing mechanism for fixed rate mortgages – have been slowly increasing over the past week after US inflation proved stickier than expected and the European Central Bank voted to hold rates. As a result, experts say mortgage lenders will be reviewing the margins on their current rates and may push up prices in order to insure they make a return on the money they loan out.
Over the past month the two-year swap rate has risen from 4.55pc to 4.77pc, while the five-year rate has risen from 3.99pc to 4.23pc.
For those needing to remortgage or trying to get a foot on the housing ladder, the news will be disappointing as many expected to see rates continue to fall over the coming months.
