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How High Will Interest Rates Go?

Many Happy Returns

CHAPTER

The Risks of Hedging Your Mortgage Rates

The Bank of England looks at inflation and determines the bank rate. That kind of sets short term guilt yields with a bit of anticipation from the market. And then mortgage rates, look at those interest rate swaps. And again, pricing a bit of credit risk and everything else. So it's like a cake where you've got the risk free rate to the bottom and then you just layer in risks as you go further out.

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