The shift in long term interest rates in the past year has been quite dramatic as this graph shows. While all rates plummeted at the start of the year, floating and one year interest rates have remained steadfastly low. However five-year rates have risen sharply. Shorter term rates will climb over time too, but there is some divergence of views over when and by how much. For borrowers the question is whether to lock in five year rates before they go higher, or continue to roll over short term rates and hope that the average cost of the long term is lower than 8.30% - the current rate for five year loans.
