Antony Summers, Private Client Partner at Broadstone Pensions & Investments, believes the latest UK GDP and unemployment data points to the UK being the first developed world country to increase interest rates:
"The unemployment rate at the end of March has now come down to 6.8%, which is the lowest it has been in over five years. In addition, UK Gross Domestic Product (a primary indicator into the health of the economy) is pretty close to pre-financial crisis levels, which would be a significant landmark for the UK economy. In our opinion, this positive economic data, only increases the likelihood of the UK being the first developed world country to increase interest rates. Along with everyone else, we will need to wait to hear what the Bank of England Governor has to say. We still think that the effect of increased mortgage rates on the UK economy specifically means that interest rates will not move this year, but all the signs now firmly point to the increase early 2015."