Irish banks could see a hike in interest rates next week

Irish banks could face an interest rate surge as early as next week.

Fixed rates at AIB and its subsidiaries EBS and HAVEN are going up by half a percentage point with immediate effect - which will make it €300 euro per year more expensive for new borrowers and switchers.

The Irish Independent's personal finance editor - Charlie Weston - says rivals Bank of Ireland and Permanent TSB could follow suit within days.

"We have been waiting for interest rates since July when the European central bank moved its main rates. The good news is that they have held off until now with only half per cent interest across all the AIB, EBS and HAVEN fixed rates. There is no increase in the variable rate which is a bit of a surprise."