Cost of Living Crisis and Interest Rate Rises

More than 2m households have missed a bill payment every month this year as people struggle to keep their heads above water in a “relentless cost of living crisis”, according to new research from consumer group Which?. In June an estimated 2.1m households missed or defaulted on at least one mortgage, rent, loan, credit card or bill, according to the consumer champion’s monthly insight tracker. This figure has been above 2 million every month so far this year, it said. – Guardian

The Bank of England has raised the spectre of a sharp rise in interest rates after deputy governor Sir Jon Cunliffe said that households could withstand borrowing costs as high as 5pc without defaulting on their debts. A combination of more fixed rate mortgage borrowers, lending caps imposed by the Bank in 2014 and taxpayer support during the cost of living crisis mean that families could cope with rates far higher than the 3pc peak forecast by markets in coming months, Sir Jon said. – Telegraph

 

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