As we move into June and approach what many expect to be another rise in interest rates, the news from the high street seems to be indicating that recent rate hikes may finally be having some effect.
Even though the figures were effected by wet weather throughout the month of May, the fall of 1.8% compared with May 2006 is a welcome relief to the Bank of England. So have interest rates now peaked in the short term?
A recent survey has found that a staggering £3.5 billion is being held in homes around the UK, losing an incredible £174 million in interest payments a year. While surveys in the past have uncovered a number of the UK population who have a lack of confidence in banks, like to store money or hide money form the tax man, the figure of £3.5 billion has beaten all expectations.
While we are all aware that interest rates have been, and continue to, move upwards, it seems that this is offering the financial community a chance to recoup some of their losses from elsewhere. There are reports in the press that some Banks have been increasing savings rates in line with base rate changes, but increasing loan rates by more than base rate changes.
So is this really a big deal?
