LONDON (MNI) – Interest rates on two-year fixed rate mortgages fell
in July to their lowest level on record, data released by the Bank of
England showed Tuesday.

The interest rate on a 2-year fix rate mortgage with loan to value
of 75% declined to 3.14% in July from 3.36% in June, the lowest since
records began in 1995.

Five year fixed rates declined to 4.69% from 4.9%.

The decline in mortgage interest rates in July stems from declines
in gilt yields and swap rates during the month as investors sought
safety from the European financial crisis and increasing evidence of
slowing economic growth.

SONIA, at present a very rough guide to market rate expectations,
shows no rate hikes expected at any time through 2012.

–London newsroom 4420 7862 7491 email: drobinson@marketnews.com

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