The Bank of England earlier this month issued a very positive outlook for 2021. The Bank expects the economy to grow 7.25% this year, which is the highest rate forecasted in more than 70 years. The forecast is a reset from that offered only three months ago which was 5% lower. The strong outlook was given as the UK is still under lockdown restrictions and on alert as to further complications from Covid variants that could set back progress as the populations seeks to get vaccinated.

Inflation is expected to outgrow the 2% target in the end of the year, but otherwise will be kept under control.

Consumers are anxious to get about to returning to normal as the summer months grow near. Travel, dining, outdoor activities, and life events that were missed last year are expected to be fully embraced this summer and that means spending will have a positive impact on the economy, local businesses, and jobs.

The outlook certainly eliminates any expectation of more cuts to the Bank’s standard base interest rate. Instead, those looking to borrow, especially in mortgages or remortgages, should expect to see rising rates, likely at the beginning of 2022. If the economy begins to recovery more rapidly, then rates could be adjusted upward sooner rather than in the next year.

The current interest rate is at a historic low of 0.1% and even a slight increase could cost a substantial loss of savings. This news could motivate home buyers and homeowners seeking to remortgage to put their goals of borrowing as a priority for the coming months rather than wait out for lower rates.