Bank of England set to raise rates

The Bank of England is likely to disappoint homeowners this week by raising interest rates.

Economists widely predict that the Bank’s Monetary Policy Committee will raise the cost of borrowing by a quarter of a percentage point to 4.75%.

They say a rise is almost certain following strong official retail sales figures last month, a rise in consumer borrowing to £1 trillion and continued house price buoyancy.

Fears have even emerged of a half percentage point hike to 5%, with employers organisation the CBI warning in a statement that such a rise would be “a real blow to business.”