Thursday, May 17, 2007
Is 7% a possibility?
The Independent: Hamish McRae: Let us hope a 7 per cent interest rate is a bridge too far
"What is the Bank - or indeed any central bank - more interested in keeping reasonably stable: the price of goods and services or the price of assets? I would say both. Excessive swings in both types of inflation are tremendously destructive socially, and eventually in economic terms too. The Bank, like most other central banks, has been very successful at the former task and an utter failure at the latter. Last autumn I warned of the possibility of 6 per cent rates. That fear is now commonplace. I am beginning to wonder about 7 per cent. Let's hope that really is a bridge too far".
Posted by becky @ 11:35 AM (175 views) Add Comment
2 Comments
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1. Orwell said...
The Cambridge Chamber of Commerce think so and presumably they include Cambridge academics. Of course I know that you can rib academics and particularly Economics academics (the dismisal science). But... Cambridge is Cambridge...bubbles are bubbles.......
2. Orwell said...
YES. IR's when Servyn Mervyn said HP's were 50% too high (last June) = 5%. So 150% x 5% = 7.5% (at least)