ALTHOUGH the Bank of England’s most recent 0.25 of a percentage point base-rate rise, on August 5, is now a distant memory, many of us will not feel its effects until the beginning of September. In the first few days of the new month, interest rates will be going up on both savings accounts and mortgages.
On September 1, the Co-operative Bank passes on the full 0.25 per cent rise to its cash mini Isa, Bonus and Future Fund savings customers.
But its existing mortgage customers will be less pleased to find that the rate on the bank’s standard-variable mortgage is also going up, from 6.04 per cent to 6.34 per cent.
On September 2 the interest rate on cahoot’s standard savings account will increase by 0.25 per cent to 5.1 per cent, while UCB Home Loans, part of Nationwide Building Society, will add 0.25 per cent to the rates on its three variable-rate mortgages.
But, good or bad, all this going up is not going to last for ever, according to Steven Andrew, the chief economist at Isis, the fund manager.
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Mr Andrew says the most recent base-rate rise is the last one we are likely to see this year. The economist says that the economy will slow down by the end of 2004, negating the need for any further increases.