Thursday, May 10, 2007
Why Britain needs a half-point hike
MoneyWeek: Will we see a 0.5% interest rate hike today?
Another month, another interest rate decision. What’ll it be today? The Americans didn’t spring any surprises last night, keeping the US key interest rate at 5.25%, where it’s been since last June. It seems unlikely that our own Bank of England will be making any headlines either. A rise to 5.5% is widely expected. While a half-point hike might be just the medicine the British economy needs right now, it’s unlikely to garner enough support among the Monetary Policy Committee’s members. That’s something they may come to regret later…
Posted by mary @ 10:30 AM (138 views) Add Comment
5 Comments
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1. Silver Surfer said...
First comes denial then eventualy reality must break through. Who needs to save when we can use our homes as a personal ATM, to the tune of around £1bilion mortgage equity release EVERY WEEK nationaly (all tax free of course). The term Alice in Wonderland springs to mind here. Stand by for an action replay of 1990/91. May 1989 to Feb 1991 base rate fluctuated between 13.75% - 14.87% thats right it took 15% to get the heat out of the housing market back then, and here we go again. As we Leemings rush towrds the edge of the cliff what do we get from our trusted highly paid media advicers? Every time an MPC meeting is iminent they talk down all the economic indicaters. After the meeting its all systems go once again. The MPC is in a box danmed if they do and damned if they don't. What poetic justice Eddie George and Gordon Brown knowingly colluded to create this mess way back when. Lo and behold dear old Gordon is now about to inherit a seat which is going to get hotter and hotter.
2. inbreda said...
No chance - it's too much of a coincidence that the war criminal is announcing his departure date at EXACTLY the same time on EXACTLY the same day that the MPC are announcing their decision - given the possibility of a 50bps hike.
This is definitely going to be a 0.5% rise.
3. inbreda said...
Dammit! the chickensh1t idiots!! Just a 25bps rise.
Ah well - at least the war criminal is off. His arrest for war crimes and a 50 bps rise would have been better, but there's still time.
4. Deadspider said...
Of course he's off .
He's heavily in debt , and with interest rates rising he needs the extra income he will receive from book deals etc which he can't receive as The Head of the Hood .
5. d'oh said...
I must admit that when i heard last week he was going to be making his announcement on Wednesday or Thursday this week I figured it would be to cover up any bad news about interest rates. I'm sure it was part of it...just in case the MPC decided on a 0.5% increase. Having said that, I wasn't enough of a conspiracy theorist to place money on a 0.5% hike on Betfair. Very disappointed by the MPC. Interesting that Sterling fell after the announcement...clearly we weren't the only ones who thought a 0.5% rise was a possibility.