Wednesday, May 16, 2007
Must be true!!!
Daily Mail: Bank of England warns of further rates hike
The Bank of England warned this afternoon that interest rates may have to go up again.
Posted by nearly30 @ 11:24 PM (166 views) Add Comment
8 Comments
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1. confused76 said...
It starts looking bad for base rate, mortgages and the pound!!
http://www.channel4.com/news/articles/business_money/interest+rates+set+to+rise/514187
http://www.fxstreet.com/news/forex-news/article.aspx?StoryId=a68fc26f-3f59-432a-a443-b565ec7680b9
http://investing.reuters.co.uk/news/articleinvesting.aspx?type=allBreakingNews&storyID=2007-05-16T143528Z_01_L16339661_RTRIDST_0_BRITAIN-BANK-RATES.XML
http://investing.reuters.co.uk/news/articleinvesting.aspx?type=allBreakingNews&storyID=2007-05-16T160012Z_01_L16664316_RTRIDST_0_MARKETS-BRITAIN-GILTS.XML
2. talking rot said...
Confused76
Why would higher interest rates look bad for the pound?
3. confused76 said...
TR,
The market has priced already the additional rate rises, that means there is not upside for the pounds but only downside when the BoE either fails to deliver the rises or starts cutting (and they will at some point, on the PM instruction). The pound actually dropped on the day of the last .25% rate increase (since the bet was roughly 50% for 1/4 point and 50% for 1/2 point). At the same time BoJ is increasing rates, and we may see unwinding of carry trade positions when market volatility in UK/US increases. I think we are sitting at the top of a mountain with cliffs on all sides.
4. dohousescrashinthewoods said...
I have opened a cash ISA and am clearing out my stocks and shares ISA.
I sense that "assets are about to deflate".
Maybe I should just buy gold.
5. harold said...
dohousescrashinthewoods
A little premature I think - they'll keep asset inflation, and the pretence of economic stability and superiority going until they (the corporatocracy running the US and UK) have 'dealt' with Iran, and attempted to secure their oil reserves (as they did in Iraq).
6. dohousescrashinthewoods said...
Thanks Harold. I do feel a bit bewildered.
I am trying my hand at a Bullbearings account but don't know what to go for as it seems like everything is set to fall appart, what with the eqiuty markets seemingly ploughing ahead regardless of value, the £ and $ floating in an overvalued bubble, credit glacially contracting around the world and the housing market doing its Titanic "we know there's an iceberg in the room, but we've been sitting here for the last hour and nothing significant has happened so we'll be on our way in a mo"-style act.
At the same time, "truckload of food, shotgun and Scottish castle" wold invite too much ridicule for my liking at this stage.
7. george monsoon said...
for Bullbearings, try something safe like Tesco..
I just made a killing on Rio tinto - a rise of over 4 quid a share in two weeks, but its ready to go south, just like Cairn Energy
8. sold 2 rent 1 said...
dohousescrashinthewoods,
As The Hitchhiker's Guide says, "Don't panic"
I switched my ISA wrapped unit trusts into a UK Gilt and Fixed Interest fund.
It is best not to sell ISA wrapped products because of their tax-free status.
This way when the stocks crash later this year I can switch to a gold unit trust fund easily and keep the profits tax free
I might be premature but it helps me sleep at night.
One stray missile in the Middle East may bring on events faster than we thought