Mortgage holders have been given fresh hope that an interest rates freeze could be on the horizon with GB News’ Liam Halligan outlining a possible sign.
It comes after the Office for National Statistics (ONS) said the UK economy has grown “modestly” over the past three months.
Speaking on GB News, Economics and Business Editor Liam Halligan suggested the UK economy’s “subdued” growth could prompt the Bank of England to “think again” with regards to another interest rates rise.
The Bank of England had raised rates 14 times in a row in its battle to get to grips with inflation, before announcing a freeze in September.
Liam Halligan has spoken out on possible 'good news' for mortgage holders
GB NEWS
Halligan said the positive signs could mean interest rates have “peaked”.
“I often rally against the groupthink on the Monetary Policy Committee (MPC)”, he said.
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“These are the nine economists who decide what these interest rates are, they have eight meetings a year and it includes the Bank of England Governor, Andrew Bailey.”
The GB News Economics and Business Editor said the MPC have displayed an “unusual” sign that could mean another rates rise is unlikely.
He said one of its members, Dr Swati Dinghra, is rallying against further rises, which could be having a significant bearing on the Bank’s direction.
“Out of all of them, she is the most intellectually independent”, he said.
Bank of EnglandPA“She has unusually spoken out ahead of the next interest rates decision to say, ‘look guys, we really need to hold interest rates’.
“That will be good news for mortgage holders and also those with personal debt and firms.”
Despite a modest 0.2 per cent rise in gross domestic product in August, fears are still mounting over a recession in Britain.
Dr Dhingra, speaking to the BBC, said most of the impact of the Bank’s 14 rate rises was yet to be felt.
“The economy’s already flatlined, and we think only about 20% or 25% of the impact of the interest rate hikes have been fed through to the economy”, she said.
“So I think there’s also this worry that that might mean we’re going to have to pay a higher cost than we should be paying.”
The services sector was the main driver of growth in August, growing by 0.4 per cent, according to the ONS.
Chancellor Jeremy Hunt said: “The UK has grown faster than France and Germany since the pandemic and today’s data shows the economy is more resilient than expected. While this is a good sign, we still need to tackle inflation so we can unlock sustainable growth.”