Sunday, Apr 29, 2007
Fionnuala OK's Mervyn's plan to raise rate
Nationwide: Pick up in house price growth seals a May rate rise
Dear Mervyn, you are allowed to raise IR, but only once otherwise you destabilize the market. Cheer up, you are independent Mervyn! Yours truly, Fionnuala
Posted by confused76 @ 07:38 PM (52 views) Add Comment
7 Comments
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2. Bangybongo said...
...so basically, story here is: ``Nationwide issues profit warning if interest rates rise half a percent.'' Nationwide, the U.K. bank and mortgage lender, said its customers may not be able to repay their mortgages if the monetary policy committee raises interest rates half a percent in May. Nationwide, which makes XX percent of its profit from lending to homebuyers, said affordability is becoming more difficult and that the property market is ``cooling.'' ONLY KIDDING. EVERYTHING'S HUNKYDORY.
3. paul said...
There is a good point buried here.
If the Mervyn King of Wishful Thinking only raises by 0.25%, it shows the Bank is not serious about inflation.
4. Phcahill said...
I wonder what she meant by "House price crash predictions are premature". How long does she believe we will have to wait.
5. harold said...
Merv has a difficult balancing act to perform - if he raises rates by .5 the dollar will plunge even further and the poodle in no. 10 will get a kicking from across the Atlantic. Ah, thank God for the special relationship. (Sorry, I'm in a cynical mood...)
6. Realist said...
"...talk of rates climbing to 6%...damaging to housing market stability....could also precipitate price falls"
Fifi, presumably it is ok to have an unstable market as long as it is moving in a direction that you approve of? As an economist, I also wonder why it is so unfathomable to you that a market may need to move in another direction after years of unsustainable rises?
7. Scott said...
I suggest we take a back seat and then re-group when the interest rate decision has been made. Everything until then is just bullshit and noise.