Press Release

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Panel of 9 economists all predicted interest rate rise: Finder UK’s inaugural BOE Bank Rate Survey

  • BOE Overnight rate rises 25 basis points to 0.75%
  • Finder UK launches inaugural Bank Rate Survey: all 9 economists predicted rate rise
  • Over half of economists predict increased trade costs could result from Brexit negotiations
  • 6 of the 9 economists hold a negative outlook for housing affordability

2 August 2018, London – An inaugural report by personal finance comparison website has found that 100% of the nine economists surveyed expected today’s decision by the Bank of England to lift the base rate.

The Bank of England rose the interest rate by 25 basis points from 0.5% to 0.75% at this morning’s Monetary Policy Committee (MPC) meeting – the fifth meeting of 2018 and only the second interest rate rise since July 2007.

According to the Finder UK BOE Bank Rate Survey, some of the economists believe the increase marks a shift following a decade of record low interest rates.

Peter Dixon, Financial Economist at CommerzBank, commented in the report that “…despite all the concerns about the weakness of the UK economy, we no longer need rates consistent with the crisis levels of 2009.”

Jeremy Thompson-Cook, Chief Economist at WorldFirst, cited similar reasoning, stating that, “…a hike in August marks the first steps of undoing the emergency levels of accommodation that have been provided to the UK economy since 2009.”

When asked to share their outlook on five economic indicators over the next six months, the report found that wage growth saw the most positive outlook, with six of the nine economists (67%) expecting a positive outlook for the next six months. It was followed by employment (44%), cost of living and housing affordability (both at 22% respectively).

When asked for their thoughts on potential economic outcomes of Brexit negotiations, just over half of the economists (56%) cited increased trading costs, and 44% believe the negotiations could result in a higher cost of living. The survey also found that 33% foresee weakened exchange rates.

The factors our economists think will result from Brexit negotiations

FactorsProportion of panelists
Rising interest rates22%
Higher property prices0%
Higher cost of living44%
Greater household debt22%
Rising unemployment22%
Tighter lending rules0%
Increased trade costs56%
Weakened exchange rates33%
Restricted government spending22%

Commenting on the rate increase, Jon Ostler, UK CEO at, said: “Today’s decision comes as no surprise. Our panel of nine leading economists unanimously predicted that the interest rate would rise by 25 base points, and this is a positive sign that the economy is growing stronger.

“It’s particularly good news for savers, who have suffered ultra-low interest rates for the past decade. They can expect a rise to their savings, albeit a small one. Now is a good time to consider switching your banking products, as banks will be reviewing their rates. Make sure you keep an eye on which banks are offering the best interest rates as not all of their products will increase by the BoE’s 25 basis points.

“On the other hand, borrowers and homeowners with a mortgage are likely to face extra costs. For example, those paying off the UK’s average mortgage debt with a variable rate mortgage face paying an extra £17-£18 per month, which adds up to an extra £200 per year or more than £6,000 over the life of a 30-year loan term.”

The forecasts and comments by the nine economists in the inaugural Finder UK Bank of England Bank Rate Survey:

Name and titleOrganisationForecast for August 2Comments
Peter Dixon, Senior EconomistCommerzbankIncrease by 25 basis points“Primarily because, despite all the concerns about the weakness of the UK economy, we no longer need rates consistent with the crisis levels of 2009.”
Alan Bridle, UK EconomistBank of Ireland UKIncrease by 25 basis points“Evidence of some acceleration in growth after a weak start to 2018, a more implicit desire to avoid a further slide in Sterling with impacts on imported inflationary pressures and, after a decade of ultra-low rates, a greater understanding of the unintended consequences and the need to begin a process of modest adjustment.”
Philip Rush, Founder and Chief EconomistHeteronomicsIncrease by 25 basis points“To prevent excess demand building a domestically generated overshoot of the inflation target.”
Jeremy Thomson-Cook, Chief EconomistWorld FirstIncrease by 25 basis points“Growth has rebounded from a poor, weather-affected Q1 and wage inflation is seen to increase further by the end of the year. A hike in August marks the first steps of undoing the emergency levels of accommodation that have been provided to the UK economy since 2009”.
Sanjay Raja, UK EconomistDeutsche BankIncrease by 25 basis points“Resilient output data (especially in May) coupled with broadly positive labour market data should be compelling for most members on the MPC. Additionally, we expect a pick up in inflation, which we think could also push some MPC members who are undecided to act sooner rather than later in order to curb inflationary pressure.”
James Smith, Developed Markets EconomistINGIncrease by 25 basis points“Overall, the recent data flow has suggested the economy has regained some poise after a particularly weak first quarter. With wage growth still performing reasonably well, it looks like the Bank is gearing up for a rate rise in August. But what comes thereafter is less certain. The retail sector is still struggling, whilst noise surrounding Brexit is only likely to ramp up as we head into the autumn. That could make it trickier for the Bank of England to hike rates further before the UK leaves the EU.”
Carlos de Sousa, Senior EconomistOxford EconomicsIncrease by 25 basis points“When it became clear that the run of poor data published through April would prevent the MPC from raising interest rates in May, we argued that the hike would merely be postponed for a few months, rather than abandoned altogether. And an August rate hike is looking increasingly likely as each week passes and the data offers further confirmation that the Q1 weakness was a blip. The CIPS surveys for June added to the body of evidence that activity has recovered in Q2. All three sectors reported stronger PMIs in June than May, with the acceleration in services activity particularly impressive – June’s balance was the highest for eight months and, indeed, it was the first time in this period that the balance had exceeded the long-run average.”
Andrew Wishart, UK EconomistCapital EconomicsIncrease by 25 basis points“The Monetary Policy Committee held off raising rates in May because it wanted to see evidence that the weak patch in economic activity at the start of the year was just a blip. The official data and business surveys released since then suggests that growth did indeed recover in Q2. With little slack left in the labour market, robust growth is likely to lead to a further increase in wage inflation. Alongside the MPC’s ambition to return interest rates to a level from which they can be cut to help in the next downturn, we think that provides reason enough for the MPC to raise interest rates in August.”
Olga Tschekassin, Global EconomistDolfin FinancialIncrease by 25 basis points

To view the full results of the survey, complete with embeddable infographics, please visit:


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