The bank is set to raise rates for the 13th straight month on Thursday and rising borrowing costs will hit more than a million mortgage holders.
Few industries have lobbied as hard and effectively as banks to put governments out of business and make room for financial innovation
Ministers have been warned of impending catastrophe as households deal with soaring bills. But a Treasury insider argued that government intervention in mortgages was “the most dangerous thing a government could do.” Borrowing to subsidize mortgages risks further accelerating inflation, forcing the Bank of England to respond by raising interest rates. The bank is expected to raise rates by a further 0.25 percentage points to 4.75% on Thursday for the 13th straight day of hikes.
Rising borrowing costs will hit more than a million mortgage holders whose fixed-rate contracts are coming to an end
Some economists said a sharp rise of 0.5% was “not out of the question.” Average annual mortgage bills are expected to increase by £2,900 over the next year according to think tank Resolution Foundation. Financial Conduct Authority guidelines require lenders to provide individualized support when mortgage holders are in trouble. Analysts said the bank “will have to choose between pushing more mortgage borrowers to the brink or letting inflation riot.”