Recent base rate increase by The Bank of England

UK (online-unsecured-loans) January 27, 2007:Recently, the Bank of England has increased the base rate. This will have a considerable impact on the consumers who have various types of loans, mortgages and overdrafts against their names.

According to the The Royal Institution of Chartered Surveyors (Rics), rise in consumer price inflation (to about 3%) is a crucial factor that has led to the decision of raising the base rate. Another factor responsible for the base rate hike is strong growth in the economy.

The inflation in the economy is a major concern that has influenced the bank's decision to raise the base rate. It is expected that there may be a growth in the wage rate in January to the 4.5 per cent limit. The Bank of England considers this rise as being consistent with meeting the inflation target.

There is a warning from Rics that the Bank may increase the rate again in February on the basis of a new set of inflationary forecasts. So, those Brits who are planning to borrow money for meeting any urgent needs, this is the time to take prompt action. They can save a significant amount of money on interest if they apply for loans now. This makes more sense if you are planning to go for unsecured loans that carry a higher rate than secured loans. The base rate rise will further increase the rate on unsecured loans. So, sooner you apply, greater the savings you can make.


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