The UK unemployment rate has dropped to 7.1 per cent and is approaching the point at which the Bank of England has said it will consider raising interest rates.
The Bank of England vowed not to raise the base rate until unemployment fell to 7 per cent, which could now happen much sooner than anticipated.
The rate fell by 0.3 per cent in the three months to November, faster than the predicted fall of 0.1 per cent, according to the Office of National Statistics (ONS).
The number of people claiming Jobseeker’s Allowance fell by 24,000 to 1.25 million in December, while the number employed grew by 280,000 to 31.5 million.
The base rate has a knock-on effect on mortgage rates as a lower rate encourages lenders to offer more competitive deals. Any change will have an impact if you have a tracker mortgage.
When asked by What Mortgage for market predictions for 2014, the general consensus among experts was that the base rate would not be changed before 2015.
You can read more about their forecasts for the year ahead here: http://www.whatmortgage.co.uk/feature/predictions-mortgage-market-2014/
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