The Bank of England’s bumper 0.5% rate hike this week was the 13th rise in a row. After sitting on their hands for more than a decade, ratesetters have been shaken out of their slumbers by an inflation storm. By historic standards 5% is not high for interest rates, but unfortunately for borrowers we also started from a historic low and have gone from 0.1% to here in just 18 months. The belated headlong rush into raising rates is also the exact opposite of what the Bank of England spent years assuring homeowners would happen: the party line used to be ‘gradual and limited’. The Bank is hiking rates to try to crush inflation but at the same time this affects a much smaller slice of homeowners than it once did and rapid rise in mortgage costs is crushing a generation of homeowners. So, was another rate rise a wise move? How bad is the pain for borrowers? Is this not a patch on the '80s, or just as bad? Has the Bank of England even given its rate rises long enough to take effect? On this rate rise special podcast, Georgie Frost, Lee Boyce and Simon Lambert tackle all that and more.
