UK interest rates 'could be higher for longer' despite growth news this week

Résumé détaillé

"Growth is welcome, but with interest rates now at 4% and inflation still stubbornly high, stronger GDP makes further rate cuts less likely in the short term. More economic…

The UK economy grew by 0.7% between July and September 2026 compared with the previous three months, according to the first estimate published on Thursday by the Office for National Statistics. GDP was also 1.9% higher than in the same quarter a year ago.

Services drove the growth, rising 0.9% over the quarter. Production grew 0.1%, while construction fell by 0.7%.

Experts have been reacting in the days since, with one telling Newspage that, despite the positive figures, interest rates could stay "higher for longer".

Samuel Mather-Holgate, managing director and Independent Financial Adviser at Swindon-based Mather and Murray Financial, said: "These figures suggest Labour’s focus on stability might be starting to pay off. One quarter does not prove the strategy, but 0.7% growth is an encouraging sign.

"The Budget should build on that with predictable taxes and a clear plan that gives businesses confidence to invest and hire. For households, growth only becomes real when wages stretch further and jobs feel more secure.

"For businesses, it means stronger demand and the confidence to expand. Services are doing the heavy lifting, while construction’s decline shows the recovery remains uneven. Stronger growth does not guarantee cheaper mortgages: inflation will still shape interest rate decisions. Labour has grounds for encouragement. The next test is turning better GDP figures into better living standards."

Riz Malik, Independent Financial Adviser at Southend-on-Sea-based R3 Wealth, said: "Following the recent base rate rise, if the economy grows and unemployment doesn’t rise there is little reason for the Bank of England to consider rate cuts until inflation is firmly under control. Even if we see a resolution to the conflict in the Middle East we may see higher rates for longer."

Stephen Perkins, mortgage broker and managing director at Norwich-based Yellow Brick Mortgages, said: "Growth of 0.7% is encouraging and certainly better than the stagnation many households and…

"For…

Début de l'article, extrait de Daily Express. Pour lire la suite, ouvrez l'article chez le média.