Ignore the ‘experts’ and split your mortgage two ways

After forecasts over interest rates have failed dismally, homebuyers should go for fixed and variable rates simultaneously

In March 2009, as the bank base rate was slashed to a historic low of 0.5%, when did the (colossally paid) experts say they would rise again? The Bank of England inflation report tells us those brilliant guys in the City were, on average, anticipating rates back at 4% by mid-2012. In 2010 the consensus was for 3.75% by 2013. In 2011 it was 3.5% by 2014. I dislike the phrase "epic fail", but this might be a case where it is justified.

The trouble is, these forecasts do actually matter. Homebuyers want to know if they should fix their mortgage to protect themselves against future rate rises. Savers want to know if they should put their cash into long-term fixed-rate deposits or hold on for a base rate rise sooner rather than later.