A cut in interest rates is unlikely before next spring, warned the Confederation of British Industry.
It is expected that the surge in oil prices would add a quarter of a point to the consumer price index, pushing inflation above the Bank of England's target. This would prevent the Bank of England from reducing base rates before Spring, leaving mortgage payers continuing to have to find the extra repayments.
The pain on mortgage interest rates is expected to hit retailers in the run up to Christmas.
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