The Bank of England raised the official interest rate from 0.25% to 0.50% for the first time in more than 10 years on November 2, 2017. Higher interest rates are a boon to savers but hit all types of borrowers especially mortgage borrowes whose loans are variable-type loans.
Until this recent hike, interest rates have been low for many years. In fact, the cost of money – the interest rate has not been this low for many centuries. The following chart shows the interest rate since the formation of the central bank all the way back in 1694:
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Source: History is a useful guide for investors – but which period are we in today?, Dominic Frisby, MoneyWeek
The chart below shows the interest rate since 1970:
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Source: UK interest rates rise for first time in 10 years, The BBC, Nov 2, 2017
