Nice Loans.co.uk > News > Loan Rates - no clear picture of future
Discussions on future loans rates present a confusing picture.
We'd all love to know what will happen in the future and as far as interest rates go. That would help us to plan effectively and even save some money by chosing cheaper loans and mortgages.
If we knew rates were going to increase over the medium to long term, then we would all chose suitable fixed rate deals for our loans and mortgages. But if we knew rates were set to decrease, then most people would be opting for variable rate arrangements that would see their costs drop as rates decreased.
But it's not that easy and certainly in recent months, industry commentators have presented all kinds of reasons for rates going up further or rates starting to decrease. It seems amongst all these expert opinions, there is no consensus.
The argument for rates decreasing are that world financial markets need easier access to cash at the moment, UK inflation is now back under control and further significant rate rises could push mortgage payers over the edge causing more housing repossessions, and maybe setting off a true recession.
Arguments for rates continuing to rise are that higher food and energy prices could push inflation back up again shortly, suggesting that the drop below 2% last month was a blip. Also the Bank of England even warned us to expect rates to rise to 6% before the year end.
Copyright © 2007 Nice Loans - The Cheap Loans Provider
