Another rate rise in the pipeline?

Data showing that the UK housing market continues to resist the calming influence of five successive base rate rises could increase the probability of another hike, some analysts believe.

The Bank of England this week reported that mortgage approvals in July stayed firm at 115,000, defying predictions that they would tumble to 110,000.

Earlier in August, the Bank of England's Inflation Report suggested that a six per cent rate rise was virtually a given.

Homeowners' finances could suffer under the strain of another rate rise, however, with repossession figures from the Royal Institute of Chartered Surveyors showing rising numbers of houses were put up for auction in the second quarter of 2007.

Increased interest rates would also have worrying implications for the Britons dependent on unsecured credit, with the Bank of England reporting that the rise in the number of Britons borrowing on credit cards and loans in July was faster than at any time since November 2006.

While Nationwide chief economist Fionnuala Earley this week claimed "clearer signs of slower demand in the market" anticipated a further near-future rate hike, other analysts insist that the Bank's Monetary Policy Committee is making increasingly 'dove-like' noises.

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