- The Bank of England has warned that an additional 1.3 million UK households face increased mortgage costs due to the economic "shock" caused by the conflict in the Middle East.
- Its latest Financial Stability Report indicates a "deteriorated" UK economic outlook, with rising oil and gas prices, increased inflation, and tighter financial conditions.
- While the UK financial system has remained resilient, the global macroeconomic backdrop is now more unpredictable, raising the risk of multiple simultaneous vulnerabilities.
- Average two-year fixed-rate mortgages have risen by approximately 0.8 percentage points, and five-year fixed rates by about 0.7 percentage points.
- An estimated 5.2 million UK mortgage holders could see higher repayments by the final quarter of 2028, an increase from the 3.9 million predicted before the conflict.
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