Rebecca O'Connor on effects of the rise in interest rates

Mortgage chaos could be on the cards for millions of Britons with interest rates tipped to be above six percent by the end of the year. Just 12 months ago, the interest rate in the UK was just 1.25 percent but it is now at five percent.

And finance experts now say there is a 70 percent chance of interest rates being above six percent by the end of the year, with 6.25 percent not out of the question.

This will further cripple hardworking Brits who are either saving up to buy their first home or are remortgaging in the next few months and worried about how they are going to afford the next interest rate hike.

The predicted rise comes as British two-year government bond yields hit a new 15-year high today.

The high is part of a broader upward move in government bond yields.

And speaking earlier today, European Central Bank President Christine Lagarde warned that the euro zone faced a long battle against inflation.

Traders on the world’s financial markets have largely given up on hopes of multiple cuts to interest rates in 2023, something that many were predicting earlier this year.

Andrew Patterson, senior international economist at Vanguard, said: “We believe central banks have more work to do.

“We’ve always said inflation wouldn’t come down magically, even as post-pandemic supply chain issues were resolved.”

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