< p>Unsurprisingly interest rates and their future movementsform part of regular discussions with clients, colleagues and, on a number of occasions, the content of this blog.

Over the last week the waters have muddied further here in the UK as we first had encouraging data showing that the unemployment rate had fallen to 7.1 per cent. This immediately set off a number of articles and commentaries indicating that this was bringing forward a base rate rise as Mark Carney, the Bank of England Governor, had linked an unemployment rate of 7 per cent as one of his key indicators when reviewing the base rate.

This so-called forward guidance policy was brought in by the new Governor, but he has backtracked to a certain extent, by publicly stating that rates would be kept low for the time being and that a watching brief would be kept on the overall economy.

This dynamic was made even more complicated this morning by data showing that London is creating private sector jobs at a rate ten times faster than the next best city, Edinburgh. Couple that with the current growth in property prices in London and the problem of setting an interest rate for the whole of the UK becomes even more difficult.

If this wasn’t making a forecast tricky enough we have Sterling appreciating on the foreign exchanges and inflation falling below the Bank’s target level, which would normally indicate a downward pressure on rates.

All very confusing when we have had the base rate at an ‘artificial’ level of 0.5 per cent, but it has been at this ‘artificial’ rate for over five years.

These conflicting signals are making decisions very tricky for borrowers weighing up the pros and cons of fixed versus floating rates.

The obvious answer is that the next move in interest rates is definitely going to be up (barring some catastrophe that sees 0.5 per cent being classed as a restrictive rate (and before you say that could never happen, just ponder who foresaw rates at 0.5 per cent in the first place)) and from that you would say that the obvious answer is to fix.

In very rough numbers 5-year swap rates are around 2 per cent and 10-year swap rates around 3 per cent, so your commercial fixes are going to be based on these numbers. The question then becomes when do you think the base rate will get to 2 per cent? It will probably get there within five years, but this year? Next year?

The other pertinent point is when rates do start to move the Bank of England have indicated that there would be gradual moves, but even a move to 2 per cent is a 300 per cent increase on the current rate, so it is a bit of a step in to the unknown as to what effect rate rises will have on the overall economy and how quickly.

This also leads back in to the points raised earlier in the blog about the current north / south split in economic activity. The London economy could probably take a rate rise (and some would argue needs a rate rise to take some of the steam out of the property market), but as a nation this would seem to be too early in the recovery.

In conclusion if you are conservative and want certainty, now does look like a good time to fix. However, if you are prepared to speculate a little it is also likely that you could enjoy the lower floating rates for quite a time to come compared to more conservative, fixed borrowers.