Mortgages rates are not rising yet but Reeves has to act

Published On Jan 10, 2025, 12:08 PM

Chancellor Rachel Reeves faces significant economic challenges as UK government borrowing costs hit a 16-year high and the pound falls to a 14-month low against the dollar. Although the markets showed signs of stabilization, the rising costs of borrowing raise concerns for the government's budget plans, which prioritize avoiding borrowing for day-to-day spending. The impact on the mortgage market has so far been minimal, but the Bank of England's interest rate policies remain a critical focal point. Despite some retailers delivering strong results, there is uncertainty in consumer behavior and future economic growth, highlighting the need for a more robust growth strategy amid potential international trade tensions.