The base rate now stands at 5.25% – a 15-year high.

That means borrowing becomes increasingly more expensive, pushing up loan payments and mortgages which aren’t on a fixed rate.

Some forecasts indicate that interest rates could reach 6% by the end of the year.

The biggest hit will be felt by people on fixed-rate mortgages who are due to move to a new deal this year. It’s estimated that around 40,000 people here are in that position.

While the variable options have been gradually creeping up, those emerging from rates in and around the 2% mark are likely to be greeted with a figure, even for fixed, of upwards of 6% or beyond.

Sinead Campbell, head of money, debt and quality at Advice NI says that the increase in interest rates will also affect families and households not receiving social security benefits.

Many will be struggling to cope with a sudden surge in payments, putting them at heightened risk of falling into debt by prioritising mortgage payments over household necessities.

“The Bank of England’s decision to raise interest rates will undoubtedly put additional financial strain on households and for those on variable rate mortgages the hike will immediately impact their budgets.

“We know more people will turn to credit to ease financial pressure during this time, however this will only add more stress in the longer term. Advice NI is here to ensure that no one is left feeling alone, overwhelmed or unsupported during these challenging times.

“If you are struggling with your mortgage or other financial repayments, please get in touch. Our expert advisors can the first step in helping find a solution and can offer advice on extending the term of your mortgage, making a temporary switch to interest-only payments, a temporary reduction in repayments or taking out a part interest-part repayment plan.”

Angela McGowan, director, CBI Northern Ireland, said: “With inflation having come down quicker than expected in June, the pressure was eased on the MPC to deliver another bumper rate rise. But, with inflation close to 8% – quadruple the Bank’s target – and wage growth around 7%, interest rates are likely to head higher in coming months.

“Economic conditions remain challenging for households and businesses alike. For firms, the cost of inputs is a third higher than pre-pandemic, the labour market remains very tight driving up wage and recruitment costs, and demand is sluggish.

“Meanwhile real incomes are still falling for households and higher interest rates are squeezing spending power further. To drive up growth and living standards in the UK without generating inflation, we need investment to increase the productive capacity of the economy. Improvements in the tax and regulatory system – as recommended in our recently published tax roadmap and green growth reports – can provide a platform for transforming the UK economy.”