AMI: Rates unlikely to rise till Q4 2016
Robert Sinclair, chief executive of the Association of Mortgage Intermediaries, said he is “moving towards late 2016 being the first actual upward movement”.
Writing in the latest issue of Mortgage Introducer Sinclair said: “The world economic slowdown must have an impact. The lack of inflation in our economy must be taken into account alongside still stagnating wage rate.
“The drive towards the living wage will impact but be negated by tax credit changes. We are still a retail economy with manufacturing still struggling to capture markets. Rises in their borrowing costs can only be damaging.”
Sinclair said he believed it possible that the Bank of England’s governor Mark Carney may have hinted at a rate rise sooner “to correct market exuberance without needing to actually act”.
Base rates have been on hold at 0.5% since March 2009. Inflation turned negative again in September, falling to 0.1%.