The European Central Bank is widely expected to increase interest rates by a quarter of a percentage point later today, bringing its main rate to 2.5%.<\/p>\n
The bank is likely to take the step in response to rising inflation mainly driven by higher oil prices.<\/p>\n
Inflation among countries using the euro is 3.3%, which is well above the ECB’s target of 2%.<\/p>\n
That means the bank is almost certain to increase interest rates for the second time this year.<\/p>\n
The move will automatically affect tracker mortgage customers whose repayments will rise by \u20ac13 per month for every \u20ac100,000 borrowed.<\/p>\n
It will also put upward pressure on other mortgage rates over time.<\/p>\n
But savers who shop around may be able to benefit from higher returns as some financial institutions are likely to pass on the increase in future.<\/p>\n
Remarks by the ECB’s President Christine Lagarde will be closely watched for guidance about any future increases.<\/p>\n