Rates ‘could rise to 5.2%’

BORROWERS could face interest rates as high as 5.2% later this year, an analysis of the European Central Bank’s economic predictions indicate.

In a review of the ECB’s staff forecasts outlined yesterday in the Frankfurt-based bank’s monthly bulletin, JPMorgan chief European economist David Mackie said their implication is that the key rate reaches 5.20% by the end of next year from the current 3.75%.

Mr Mackie said the data may point to its benchmark rate moving “way beyond” 4%.