News

Private banks, which often lead the high street banks by several weeks, have started to increase rates for the first time in more than two years.

Money market rates, which are used by lenders to fund deals, have also been creeping up despite last week's co-ordinated effort by central banks to ease pressure in the lending markets.

The three-month inter-bank rate, or Libor, which is used to fund variable-rate deals, rose to its highest level since July 2009, while five-year swap rates, used to fund fixed-rate deals, rose from 1.61% to 1.71% last week after being on a downward trend since February.