View more on these topics

The interest rate in 2019 – the experts’ views

Mortgage Strategy has canvassed the opinion of a number of industry experts regarding what will happen to interest rates in 2019.

Inevitably, the coming 12 months are trickier to predict than other years as we’re yet to find out what kind of deal, if any, the UK will leave the EU with. This has led to a wider spread of views than might be expected.

Investec Private Bank business development manager Peter Izard thinks we’ll see two 0.25 per cent interest rate rises in the coming year, with the base rate at 1.25 per cent by the end of 2019.

Coreco brand director Andrew Montlake says Brexit means any kind of prediction is fraught with danger. “On the face of it, the gentle pace of interest rate rises should continue, ceterus paribus, with one or two rises of 0.25 per cent easing rates up over the next 12 months.

“The Bank of England will not want to deviate from this course of action unless circumstances really dictate otherwise and despite all the tough rhetoric from Carney, this would probably be the perfect scenario going forward,” he says.

However, other industry pundits disagree that we’ll see a rate rise or two. SPF Private Clients chief executive Mark Harris thinks interest rates will end 2019 at 1 per cent while John Charcol senior technical manager Ray Boulger doesn’t think we’ll see a raise at all – his guess is that bank rate will remain at 0.75 per cent for the whole of 2019.

London and Country communications director David Hollingworth even goes so far to float the idea that rates could fall next year. He says: “The current trajectory for interest rates has been upward and the Bank of England has been clear that rates could gradually ease up.

“However, although a disorderly Brexit wouldn’t necessarily change that path it may well see additional support to the economy being required and rates could come back down,” he adds.



Gross lending forecast to grow 39% to over £286bn by 2019

Gross lending is forecast to reach over £286bn by the end of 2019 due to an improving economy and growing wages. Timetric, a firm that provides business information services to financial services companies, predicts average growth of around 7 per cent each year until the end of 2019. It forecasts gross lending to reach £218.6bn […]


Carney to leave Bank of England in 2019

Bank of England governor Mark Carney has extended his term to June 2019 when Brexit negotiations are expected to be completed. Carney’s decision means he will serve one year more than the five he had originally committed to, but he will depart two years short of a full eight-year term. In a letter sent to […]

Govt ‘will run £10bn surplus by 2019/20’

The Chancellor says the Government will run a £10bn surplus by 2019/20. Osborne forecasted a surplus of 0.4 per cent of GDP in 2019/20, followed by a surplus of £11.6bn, equivalent to 0.5 per cent of GDP, in 2020/21. The deficit is forecast to be 3.7 per cent in 2015/16, before falling to 2.2 per […]


Average house price falls by £5,222 in November: Rightmove

The average UK house price fell by £5,222 or 1.7 per cent in November, according to Rightmove. The property website tracks asking prices of properties coming on to the market and says prices are falling fastest in Britain’s wealthiest towns as Brexit uncertainty grips the property market. Rightmove reports that the biggest falls are in […]

India Election Update

What a difference six months makes. Speaking in September last year, we had warned of ‘excessive pessimism’ afflicting the market’s perception of India. Since then, responsible central bank policy from the Reserve Bank of India (RBI), alongside improving global growth, has meant that India’s macro environment is strengthening quickly. The current account deficit has shrunk, inflation is falling and the government has embarked on a heavy dose of much needed fiscal consolidation. As a result, the rupee has been one of the strongest global currencies this year while the market has touched all-time highs, rallying by more than 20 per cent (GBP) since September. This begs the question: are we now in a period of ‘irrational exuberance’? Not yet.


News and expert analysis straight to your inbox

Sign up