Brits ‘to face further debt pressure’

Howard Archer, chief UK and European economist for Global Insight, is convinced that the Bank of England will opt to raise the base rate of interest at some point later this year.

Any increase would lead to added financial pressures for credit consumers and mean a rise in repayment rates for homeowners around the country.

Mr Archer said: “Interest rates are still likely to rise to six per cent in the fourth quarter unless there is clear evidence that the 125 basis points rise in interest rates enacted so far is increasingly feeding through to dampen economic activity and contain underlying inflationary pressures.”

The Bank of England decided to raise the cost of borrowing this month for the fifth time since August of last year.