UK Interest rates forecast

[thatch]

just about to choose a new mortgage, so deciding between variable or 3 year fixed rate.

Not financially minded, so wondered if anyone here had any idea about which way interest rates will go over the next 3 years?

thanks

[stooz]

they may go up or down in fact it would be illegal to offer advice.

The only judgement you need to make is wether you have the financial flexibility to cope with increases?
If not, go for the fixed. it's certainly very low at the moment, so it could be suggested there isnt much room to go down.

[z1000]

thatch said:

just about to choose a new mortgage, so deciding between variable or 3 year fixed rate. Not financially minded, so wondered if anyone here had any idea about which way interest rates will go over the next 3 years? thanks

A good start might be to wait 'til tomorrow

[catretriever]

well.....the markets are currently pricing in a small reduction....I'd go for the best possible discount you can get on a variable rate....you can always change it at a later date...

edited to add standard disclaimer...
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This has been prepared solely for informational purposes. It is not an offer, recommendation or solicitation to buy or sell, nor is it an official confirmation of terms. It is based on information generally available to the public from sources believed to be reliable. No representation is made that it is accurate or complete or that any returns indicated will be achieved. Changes to assumptions may have a material impact on any returns detailed.


>> Edited by catretriever on Thursday 5th May 13:59

[aspender]

I was told a few years ago on an "Introduction to the city" course to get the FT, and find the UK treasury bonds table. The yield price is a fair prediction on interest rates at the time the bond matures.

A quick look here seems to back this up.

[thatch]

z1000 said:

thatch said: just about to choose a new mortgage, so deciding between variable or 3 year fixed rate. Not financially minded, so wondered if anyone here had any idea about which way interest rates will go over the next 3 years? thanks A good start might be to wait 'til tomorrow

why - what happens tomorrow?

but seriously, what difference would having a new government make?

[AC79xxx]

I'm currently waiting for my existing term to finish in August so have been thinking about the trade off between fixed and variable rates over 3 years too.

The only recommendation I can make is to work out the differences on your monthly payments over the term and how many 0.25% rises are needed to either match or go over and above the fixed rate repayments and go from there.

Agreed, if Labour are still in No. 10 tomorrow I'm banking on there being a stable interest rate until late in the year where a 0.25% increase wouldn't seem unfeasible. If it does come down it's a bonus.

[catretriever]

The good news is that it would be very difficult now for any government to take us back to the bad old sad old days of Tory interest rate manipulation since that power is now in the hands of the BofE. best thing Labour ever did!

[z1000]

catretriever said:

The good news is that it would be very difficult now for any government to take us back to the bad old sad old days of Tory interest rate manipulation since that power is now in the hands of the BofE. best thing Labour ever did!

Well lets hope so FFS! not that I think they'll get the chance

[catretriever]

aspender said:

I was told a few years ago on an "Introduction to the city" course to get the FT, and find the UK treasury bonds table. The yield price is a fair prediction on interest rates at the time the bond matures.

quite right...here's the current yield curve