Band of England Money and Credit comment

Reporting on the Band of England Money and Credit data out this morning – – Richard Pike, sales director at Phoebus Software, said: “There was strong lending in March at £7bn and with mortgage approvals remaining steady, we should continue to see a healthy mortgage market this year.

“But rates are rising with the average interest rate paid on new mortgages increasing by 14 basis points to 1.73% in March. However, this is still lower than the same time last year when it was1.95%.

“The rate for outstanding mortgages is also up slightly by 2 basis points to 2.04% but again it is below the 2.08% in March 2021.

“With a third base rate rise in five months expected tomorrow, new borrowers and those remortgaging will see rates increasing from historic lows. For many people this is the first time they will be experiencing this and with the rising cost of living and soaring inflation, some borrowers will have to tighten their belts.”