Fix mortgage rates now - Tower

"We made a big call on mortgage rates here. Fix mortgage rates in the long term because inflation is coming," he said.

Speaking at the company's quarterly media briefing Stubbs said, "We actually think for mortgage holders now people should be taking fixed term rate mortgages because ultimately if interest rates go up, as expensive as they look right now and as attractive as floating rates look now, the severity of these rate rises and the speed with which they would come on would potentially make five-year plus fixed mortgage rates look quite attractive right now."

He said Tower believed that while Governments and Central Banks had kept interest rates low to promote growth and jobs, debt pressures would soon have to be tackled by rising inflation.

"We think the majority of the western nations are going to chose to inflate their way out of debt problems, and that's going to be bad news for fixed interest investors and very good news for people who own houses with mortgages."