It is widely expected that the Bank will raise interest rates later this week. A few weeks ago, the financial markets had already priced in that the likelihood of interest rates rising to 4.5% was 97%!
However, it is expected that this would then allow the rate to be held for the next few months. And some lenders are already taking a more optimistic view of the market, with long-term fixed rates beginning to fall in some cases.
This is good news for investors, who might have been putting their plans on hold due to the higher cost of capital. If lenders are reducing their rates, it means that borrowers can begin to benefit from lower project costs, and means that we could begin to see an increase in property transactions.
What do you think is going to happen to interest rates?
