A think tank has warned that millions of people in the UK will be hit by “perilous” levels of debt when interest rates start to rise again.

The Resolution Foundation has said that the levels of debt built up by families in the pre-crisis years are such that “even relatively modest changes in incomes and borrowing cost assumptions produce significantly worse outcomes”.

The Bank of England has kept interest rates at their lowest level ever at 0.5% since March 2009 but Governor Mark Carney has said that this will be reviewed once unemployment, currently at 7.4%, falls below 7%.