Top economist warns rates will rise 1%

INTEREST rates will rise by close to 1% between now and the end of 2006, a top economist warned yesterday.

The moves by the European Central Bank will start early next month with a 0.25% increase and there will be further rises in 2006, said IIB Bank's chief economist, Austin Hughes.

The increases will rob the consumer of €1 billion in spending power, but they will not be enough to undermine the economy or the housing market.