Suffolk financial expert expects interest rates to go up today

Economists are expecting interest rates to increase today despite the drop in UK inflation.

Defying experts’ expectations, inflation fell to 6.7% in the year to August, according to the Office for National Statistics.

It marks the lowest rate since February last year.

However, Phil Ball, a Chartered Financial Planner and the Director of Norfolk and Suffolk Financial Services, believes that interest rates will still go up by 0.25%.

This belief is due to surging oil prices and strong wage growth.

He said: “Things have certainly changed as a result of the inflation news. However, in my view, it is still likely that the Bank of England will put interest rates up by 0.25%.

“That's my personal view because they want to be on the side of caution; trying to get inflation under control is the big priority.”

Phil added that if interest rates increase, this will impact people with a variable mortgage rate negatively.

He said: “Fixed rate mortgages have come down over the past two months, which suggests that they think that base rates will come down at some point.

“But nevertheless, people who are borrowing on a mortgage with a variable rate or track rate would see their repayments go up; it would not be good news for them.

“On the other hand, of course savers benefit from higher interest rates. So, it's a double-edged sword. There are some winners and some losers.”

Hear all the latest news from across the UK on the hour, every hour, on Greatest Hits Radio on DAB, at greatesthitsradio.co.uk, and on the Greatest Hits Radio app.

• interest rates
• Bank of England
• boe
• economy
• economics
• mortgages
• savings