Interest rates likely to fall to pre-Covid levels, IMF predicts

Interest rates in major economies are expected to fall to pre-pandemic levels because of low productivity and ageing populations, according to a forecast.

The International Monetary Fund (IMF) said increases in borrowing costs are likely to be "temporary" once high inflation is brought under control.

The Bank of England has been raising interest rates since December 2021, taking them from 0.1% to 4.25%.

This has raised mortgage payments for many homeowners.

Central banks in the UK, the US, Europe and other nations have been lifting interest rates to combat the rate of price rises, otherwise known as inflation.