Iran war may increase mortgage payments for extra 1.3m households, says Bank of England

Financial policy committee predicts ‘Trumpflation’ rises, as average two-year fixed rate hits 5.84% The US-Israel war on Iran could end up increasing monthly mortgage payments for more than one million more UK households, the Bank of England has predicted, adding that the conflict had dealt “a substantial negative supply shock” to the world economy. Financial market jitters over the conflict in the Middle East have resulted in banks pulling about 1,500 mortgage products, with many banks raising interest rates on their remaining 7,000 home loan products in recent weeks, the Bank’s financial policy committee (FPC) said. The increases, named “Trumpflation” after the US president, have put pressure on households preparing to sign on to new mortgage contracts, with the Bank now forecasting that about 5.2 million borrowers – or roughly 58% of borrowers across the country – could face higher mortgage payments by the end of 2028. That compares with 3.9 million before the conflict began, adding 1.3 million borrowers to the list of households that could have their finances squeezed. The data provider Moneyfacts reported on Wednesday that the average two-year fixed residential mortgage rate w