Tuesday, Mar 27, 2007
King damps rate rise speculation
Guardian: King damps rate rise speculation
Speculation of a further interest rate rise in the coming months was dampned today after the Bank of England governor Mervyn King said that the UK housing market was starting to slow down and that inflation would return to target in two years.
What is he going on about the market isn't slowing down, he just wants to keep the boom going.
Posted by daniel @ 02:38 PM (160 views) Add Comment
10 Comments
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1. Whiteknight said...
Moronic.
Like all people that have lost the plot (or make the mistake that they think are cleverly manipulating the situation like a magician - funnily enough thats the same thing) he simple reiterates a point of view that is not the case.
Take Cheney in the US on the Iraq situation. Look at how much of a nightmare that is. No amount of talking is going to change it.
Gordon was on a breakfast show the other morning talking about inflation being around 2-3%. Isnt transport inflation alone about 35% compounded over the last few years?
Talk too much rubbish and the revolutionary mob takes a look at what money is actually in their pockets finally and starts lopping peoples heads off.
Best to keep it believable.
2. Yoman said...
"However, he added that he had no reason to believe it would not return to its 2% target by 2009"
By 2009, it will be -2.0% not 2%. Is that what was happened in Japan?
3. royston said...
His position is exactly the same as Bernanke's: show an awareness of inflation but show a willingness to maintain economic growth, meanwhile do nothing. You have to ask why? I think he see the UK as being in the exact same circumstances as the US is - credit-bloated, weary, but not yet in recession. Let's hope that the US property continues to slide and that UK buyers recognise the similarity of circumstance and up (or should that be 'down') fast.
4. Sam said...
Well the pound dipped slightly on that news, and am sure it will dip further on rates sticking.
deflation here we come -- although that may be a tactic to get us to join the Euro - as we need to devalue the pound before we do jump in the eurozone.
5. Davros said...
Exactly. What else is he going to say? I would do the same in his situation.
The truth is that interest rates were too low for too long. Eddie George admitted as much earlier this month. As for his argument about house prices not being overvalued, this is the bloke who said a year ago :
"The level of house prices still seems remarkably high relative to those measures that put it into context," said King, at the launch of the Bank's May Inflation Report.
We've had another 10% since then!?
6. Manjit said...
UK Market needs a correction for our children's sake
7. This comment has been removed as it was found to be in breach of our Blog Policies.
8. Scott said...
I wonder how much these BOE people get paid. They only work one day of the month and that is only 1 meeting. A 14 year old watching Blue Peter every week day would have better scope.
9. geed said...
I think I am going to play the game.
I have 80-90K sterling which I point blank refuse to put into the UK housing circus, sorry market. I shall move all this off shore, claim I have no deposit and get an interest only 100% mortgage, buy a house somewhere for 200K, if it all goes sour, which logic says it should. I'll just walk away from the UK use my "other" passport and post the keys back. If it doesn’t go sour I'll sell in 3 years time net my 60+K equity (10%yoy) and b*gger off somewhere else.
I say " which logic says it should" but of course logic cannot be applied to the UK housing market for the last 5 years so I figure I will fight fire with fire and do something completely illogical myself.
C'mon, beat me up you lot!
10. geed said...
I think I am going to play the game.
I have 80-90K sterling which I point blank refuse to put into the UK housing circus, sorry market. I shall move all this off shore, claim I have no deposit and get an interest only 100% mortgage, buy a house somewhere for 200K, if it all goes sour, which logic says it should. I'll just walk away from the UK use my "other" passport and post the keys back. If it doesn’t go sour I'll sell in 3 years time net my 60+K equity (10%yoy) and b*gger off somewhere else.
I say " which logic says it should" but of course logic cannot be applied to the UK housing market for the last 5 years so I figure I will fight fire with fire and do something completely illogical myself.
C'mon, beat me up you lot!