Mortgage rates look set to increase after Labour’s gloomy messaging around this month’s Budget statement left lenders feeling concerned.

Coventry Building Society has already announced that many of its fixed-rate deals will increase along with several specialist lenders such as Aldermore.

Industry analysts said the chancellor Rachel Reeves’s repeated warnings that the Budget on 30 October will include “tough choices” had left markets concerned.

Mortgage borrowing rates have been falling for months as swap rates – the main pricing mechanism for fixed mortgages – have also dropped. But, growing concerns ahead of the Budget alongside fears of sticky inflation, slow interest rate cuts and global tensions have pushed up borrowing costs.

The market is predicting at least one more Bank Rate cut before the end of the year although expectations around a second in December have eased.

David Hollingworth, associate director at L&C Mortgages said: “The mortgage market has seen rates falling in recent months but that may be coming to an abrupt halt. Fixed-rate pricing depends on what the market anticipates may happen to interest rates and uncertainty over the forthcoming Budget, mixed messages from the Bank of England and global unrest [are] pushing costs back up for lenders.

“Swap rates are a good indicator of the direction of fixed-rate pricing and they have bounced back up. If that persists, fixed-rate improvements will be brought to an abrupt halt and edge back up.”