Cost of living - latest: Major lenders poised to cut mortgage rates; Ozzy Osbourne ad banned (2024)

Key points
  • More major lenders poised to reduce mortgage rates
  • Ozzy Osbourne gaming ad banned
  • 'Cost of living crisis coming to end' as inflation forecast to fall behind wage growth
  • Analysis: Does retailers slashing prices mean rising interest rates are finally having desired effect?
  • Heading school uniform shopping? Here are some deals to look out for
  • Use our spending calculator to see which prices have gone up or down
  • Live reporting by Brad Young

10:29:15

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07:57:22

Ozzy Osbourne gaming ad banned

An OzzyOsbourne tweet showing him gaming with a PlayStation virtual reality headset has been banned for failing to mention that it was an ad.

The Advertising Standards Authority ruled the tweet - which included a video of Mr Osbourne swearing at dinosaurs via a VR2 headset - did not clearly indicate the singer was contracted by Sony.

The tech giant argued the word "spot" in the tweet's text "Did this spot with the @PlayStation team" would be understood by users as an ad, but the watchdog said consumers should be made aware that a post was an ad before they engaged with it.

"We considered the wording, including the use of the word spot to refer to the video, was not sufficient to clearly indicate to consumers that the tweet was part of a commercial relationship between Sony andOzzyOsbourneand that the tweet was therefore an ad," said the ASA.

The video began with the PlayStation logo before cutting to Mr Osbournein a living room taking a virtual reality headset and controllers out of a blue PlayStation box as his wife, SharonOsbourne, told him that they needed to pack and catch a flight to England.

Mr Osbournereplied that he wanted to play on his PlayStation and was shown swearing at dinosaurs via a VR headset and controllers before the video ended with the text: "Play has no limits," followed by the PlayStation logo.

Sony, which responded to the ASA on both their and Mr Osbourne’sbehalf, said their agreement gave his management company final approval over the video's script.

They said Sony specified only that Mr Osbournemust share the video in a way that clearly disclosed he had worked with the company.

The ASA ruled that the ad must not appear again in the form complained about.

07:38:05

More major lenders poised to reduce mortgage rates

Yesterday we reported how Nationwide was cutting its mortgage rates by up to 0.55%.

Now they have been joined by TSB - with up to 0.4% reductions - and HSBC is expected to cut rates today.

The TSB deals apply to selected five-year fixed homeowner mortgages, with rates starting from 5.44%.

"The next inflation data is going to be key to this downward trend continuing," said Jamie Lennox, a director at Dimora Mortgages.

HSBC has not yet given details of its residential mortgage rate cuts.

There have been some signs of fixed mortgage rates becoming more stable.

According to Moneyfacts, the average two and five-year mortgage rates on the market were unchanged yesterday compared with Monday, standing at 6.84% and 6.35% respectively.

Why is this happening?

Swap rates, which underpin fixed mortgage rates, are behind the changes, having stabilised amid expectations that inflation is coming down.

UK Consumer Prices Index inflation was 7.9% in June, down from 8.7% the previous month, according to the Office for National Statistics.

This has raised expectations that the Bank of England may not need to raise the base rate much higher.

The Bank uses rises in the base rate as a tool to quell inflation and last week it hiked rates from 5.00% to 5.25%.

19:00:01

Iceland cuts prices of more than 200 weekly essentials

The supermarket has announced price slashes on over 200 weekly essentials as part of a summer savings initiative.

On top of this, a summer sale will offer 50% off seasonal favourites including ice lollies, pizza and cocktails.

Iceland says the Summer Heroes initiatives are aimed at helping out families during the holidays.

"Families are more likely to be spending their summer at home due to rising costs," said group sales director Paul Dhaliwal.

"We want to alleviate some of the stress for parents so they, and the kids, can enjoy that time together."

The supermarket has also said shoppers who use their £15 school meal vouchers with Iceland will receive £2 added to their bonus card.

18:15:01

Pound hits five-week low against dollar

The pound hit its lowest level in five weeks earlier today amid a global stocks sell-off, briefly sinking below $1.27.

Investors have been turning to the dollar, leaving sterling down against the US currency.

Bank stocks have slumped as they face a triple whammy of blows from the US, China and Italy.

Meanwhile, credit ratings agency Moody's has downgraded 10 small and midsized US banks amid higher borrowing costs and rising risks tied to commercial property loans.

It also warned it could downgrade major lenders, sparking fears about the financial health of the world's largest economy.

China has also reported poorer than expected trade data.

17:30:01

Pawnbroker profits rise amid cost of living squeeze

A jump in pawnbroker profits suggests Britons are increasingly exchanging valuables for loans to make ends meet.

Pawnbroker H&T reported a 31% rise in pre-tax profit to £8.8m in the first half of this year.

The value of its pledge book - which links short-term lending to customers' belongings - grew 14% to £114.6m. In 2021, it was worth £67m.

Earlier this year, This is Money reported a surge in the number of pawnbrokers in middle-class areas, from Surrey to Harrogate.

Approximately 85% of its customers are still paying off loans and reclaiming items pawned, H&T told the financial website.

16:35:01

Energy suppliers could rake in £1.7bn in profit over next year

Energy suppliers could collect £1.74bn in profits over the next year from customers' energy bills, a study suggests.

The profit companies are allowed to make from the average variable tariff customer each year surged from £27 to £130 between 2017 and early 2023, according to a report by Warm This Winter.

The figure currently stands at £60, while there are just 10 alternative fixed tariffs available on the market.

"This report shines a light on the murky depths of Britain's broken energy system," said Simon Francis, coordinator of the End Fuel Poverty Coalition, which is part of the Warm This Winter campaign.

"Without fundamental overhaul of the energy grid and energy tariffs, households will continue to lose out while suppliers will profit."

The figures and predictions exclude any profits which firms might also make through Ofgem decisions relating to COVID and Ukraine allowances, which contributed to the recently announced high profits for British Gas and Scottish Power, the report said.

15:43:33

Nationwide cuts mortgage rates up to 0.55%

Since we reported that average mortgage rates have remained unchanged today, Nationwide has announced cuts to its fixed rates by up to 0.55 percentage points.

The headline reduction applies to first-time buyers purchasing three-year, no fee products at 85% and 90% loan-to-value, bringing the rate down to 6.39%.

New customers moving home can take advantage of 0.45% rate reductions to 6.29% on the same products.

The building society has cut rates by 0.3% to 6.24% for existing customers moving home on a 90% loan-to-value mortgage with no fee.

"These latest changes build on the reductions we made last week for existing customers," saidHenry Jordan, director of home at Nationwide.

"With swap rates having fallen from their early July peak and stabilised somewhat, we are now able to reduce rates for new customers."

15:14:04

Drivers hit with largest weekly rise in petrol costs for a year

UK forecourts charged an average of 146.2p per litre for petrol and 148.2p per litre for diesel yesterday.

At 2.1p per litre, this represents the biggest hike since June 2022, according to Press Association analysis.

AA pump price spokesman Luke Bosdet accused oil producers of cutting production to force up the cost of oil.

The Competition and Markets Authority (CMA) is planning to launch a voluntary system for retailers to publish fuel prices by the end of the month.

Energy Secretary Grant Shapps said drivers were being "overcharged" at the pumps - echoing repeated complaints from the RAC.

"I strongly expect retailers to co-operate with the CMA to develop the voluntary scheme to this timeline and I will not hesitate to call out any foot-dragging," said Mr Shapps.

It has been noted that ministers have made a particular show of being pro-motorist since the Tories narrowly (and against some expectations) retained Uxbridge in last month's by-election - something which was credited to Labour's mayor, Sadiq Khan, who is planning to expand the ULEZ charge to outer London.

15:01:01

Savings rates creep up while mortgages remain steady

Mortgage rates are at a standstill today, according to the latest Moneyfacts.

The average two and five year fixes remain at 6.84% and 6.35% respectively - the same as yesterday.

Today's average two-year tracker rate is 6.18%, also unchanged.

A few mortgage deals came to market, up three to 5,106 products.

Savings

There has been some movement in savings, bar the average one-year fixed savings rate, which remains at 5.23%.

The average easy access savings rate today is 2.86%, up from 2.84% yesterday.

One-year fixed Cash ISA's are up 0.1% to 5.05%, while the average easy access ISA rate has increased by the same amount to 2.89%.

14:28:01

Five travel money hacks to stop you overpaying on holiday

You may have picked the perfect destination for your summer holiday, but have you chosen the perfect way to spend overseas?

Here are some helpful hacks to make sure, courtesy of the ever-fantasticMoneySavingExpert.

Play your cards right

Most cards charge a 3% non-sterling exchange fee when you spend abroad - but specialist overseas cards don't, so you might want to make sure you have one of those before you go.

First Direct is offering £175 spending money and a specialist card for anyone willing to switch banks at the moment. It also gives you a near-perfect rates for spending abroad.

If you don't fancy switching banks, here are three of the top travel cards on offer, according to MoneySavingExpert:

Going to use cash? Find the best exchange rate

If you do want cash, the cheapest bureau depends on what currency you want and how much.

The TravelMoneyMax tool compares more than 16 bureaux to find you the best rate for delivery or collection.

Do you want to pay in pounds when abroad?

This is now very common, both at overseas cash machines and in stores - they'll pressure you to pay in pounds, but Martin Lewis reckons you should say no.

If you have a specialist overseas card, then there is no doubt that using it and paying in euros is always correct.

Yet even without one of these, if you're using your plastic abroad, there is a chance you could lose out a lot.

Beware cash machine fees

Actual cash machines can charge you for withdrawing money abroad.

The fees can range in price, so it's best to have a look around. It's also worth checking whether your UK bank operates ATMs abroad.

Santander doesn't charge its customers for using its overseas ATMs, while Chase doesn't charge for using its ATMs in the US.

Don't use a credit card to buy cash or load a prepaid card

Most credit card providers count these as a cash transaction - and therefore charge fees and interest.

It's always better to use a debit card if you can.

Withdrawing cash abroad on a credit card could also be a pain for your credit record.

On the right card it's cheap, but there may be a possible minor impact on your ability to get credit in future.

Cost of living - latest: Major lenders poised to cut mortgage rates; Ozzy Osbourne ad banned (2024)

FAQs

Cost of living - latest: Major lenders poised to cut mortgage rates; Ozzy Osbourne ad banned? ›

Nationwide and TSB have cut their fixed mortgage rates, with HSBC expected to join them today; a tweet of Ozzy Osbourne gaming with a virtual reality headset has been banned by the advertising watchdog; listen to a Daily podcast special on interest rates as you scroll.

What is the highest mortgage rates have ever gone? ›

Interest rates reached their highest point in modern history in 1981 when the annual average was 16.63%, according to the Freddie Mac data. Fixed rates declined from there, but they finished the decade around 10%. The 1980s were an expensive time to borrow money.

Did US mortgage rates soar past 7% for the first time in two decades? ›

Mortgage rates in the US crossed 7% for the first time in more than two decades. The average for a 30-year, fixed loan rose to 7.08% from 6.94% last week, Freddie Mac said in a statement Thursday.

What happened to mortgage rates in 1980? ›

Thanks to their efforts, more people were saving money, but that meant it was also more expensive to buy a home than at any point in recent time. The annual rate reached 13.74% in 1980, and in 1981, the 16.63% rate was and still is Freddie Mac's largest recorded figure.

What was the highest mortgage rate in the eighties? ›

The highest mortgage rates in history were in the 1980s. Thirty-year fixed mortgage rates hit their peak at 18.63% in October 1981. This was likely due to high inflation following the OPEC embargo.

What is the lowest mortgage rate ever in history? ›

The lowest interest rate for a mortgage in history came in 2020 and 2021. In response to the COVID-19 pandemic and subsequent lockdowns, the 30-year fixed rate dropped under 3% for the first time since 1971, when Freddie Mac first began surveying mortgage lenders.

Will mortgage interest rates go down in 2023? ›

Fannie Mae, according to its recent Housing Forecast, has predicted that the average 30-year fixed-rate mortgage rates will decline from 6.5% to approximately 6% by the end of 2023 for an average of 6.3%.

What percentage of Americans have a home without a mortgage? ›

In 2021, 42 percent of all owner-occupied homes in the U.S. were owned free and clear, up from 34 percent in 2011.

Is 7% a bad mortgage rate? ›

In a recent survey by the New Home Trends Institute, 92% of current mortgage holders said they would not buy again if rates exceeded 7% — up from 85% who said the same at 6%.

Will mortgage rates go down in 2024? ›

While nobody can predict the future with absolute certainty, experts are largely predicting a plateau in mortgage rates in 2024.

What is the highest interest rate in history? ›

Interest Rate in the United States averaged 5.42 percent from 1971 until 2023, reaching an all time high of 20.00 percent in March of 1980 and a record low of 0.25 percent in December of 2008.

How did people buy houses in 1981? ›

An era of creative financing

The arrangements had names such as "contract for deed," "wraparound mortgage" and "lease with an option to buy." A June 1981 Washington Post article said creative financing accounted "for more than 50% of all 1981 home resales in many parts of the United States."

Where will interest rates be in 2023? ›

Keith Gumbinger, vice president of mortgage website HSH.com: “[We] should see less volatility for 30-year fixed mortgage rates in 2023, which are likely to hold a range between 5.875% and 6.875%.

How was inflation stopped in 1980s? ›

In order to combat rising inflation, recently appointed chairman of the Federal Reserve, Paul Volcker, elected to increase the federal funds rate. Following the October 6, 1979 meeting of the Federal Open Market Committee, the federal funds rate increased gradually from 11.5% to an eventual peak of 17.6% in April 1980.

What does a 5 2 arm mean? ›

In this example the first “5” represents the maximum adjustment in interest rate for the first adjustment (i.e. during month 61), the “2” is the cap on future adjustments, and the last number, the other “5” is the maximum amount of change ever allowed.

Will mortgage interest rates go down? ›

The latest monthly Housing Forecast from Fannie Mae, released July 19, has the average 30-year fixed rate remaining high at 6.8% during the third quarter of 2023, pulling back slightly to around 6.6% by year-end. The mortgage giant doesn't expect rates to dip below 6% until the fourth quarter of 2024.

When were 30-year mortgage rates the highest ever? ›

The 30-year fixed mortgage rate reached a pinnacle of 18.4 percent in October 1981, according to Freddie Mac, seesawing down to the 9 percent range by 1986 and closing the decade at 9.78 percent. The 1970s oil embargo against the U.S., which drove up inflation quickly, contributed to the increased borrowing costs.

What has been the highest mortgage interest rate in the US? ›

The week of October 9, 1981 saw mortgage rates average 18.63%—which is the highest mortgage rate on record.

How high have mortgage rates gone up? ›

U.S. mortgage rates rise to 6.81%, highest level this year, Freddie Mac says. NEW YORK, July 6 (Reuters) - U.S. 30-year mortgage rates rose to an average of 6.81% this week, the highest level of 2023, according to Freddie Mac's mortgage market survey.

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