Wednesday, Dec 19, 2007
Get ready for a huge gust of inflation
BBC: Bank unanimous on cutting rates
All nine policymakers at the Bank of England voted to cut UK interest rates to 5.5% from 5.75% earlier this month, minutes show.
Policymakers also discussed whether slowing economic growth meant a bigger rate cut might be needed. Analysts said the unanimous vote could boost expectations of another interest rate cut in January.
Posted by jack c @ 10:25 AM (1267 views) Add Comment
14 Comments
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1. Letsalldance said...
wow!!!
2. Theboltonfury said...
unfortunately there are many stupid people in this country that link a good house deal with IR. Couple that with more people reading the BBC et al propagandarists than they do this site and starting to believe that a crisis has been diverted. As a result I fear we'll all have to wait a little bit longer to be proven right
3. C'mon Correction said...
Sterling down again today. I think we'll see a steady slide after the xmas period. We'll have lots of inflation for us to import then.
4. cyril said...
I can understand why they are cutting base rates - because they have become detached from interest rates in the real world.
Meanwhile the banking system is going through its version of the dot com bust. That wrecked everyone's pensions, now this banking crisis will do the same for the value of cash (i.e hyperinflation). Deep joy.
5. rickyb said...
RPI inflation is increasing. CPI inflation is above target. It seems obvious to me that a rate cut is just what is needed.
6. paul said...
I'm not sure how long th Bank of England can keep being coy about this ...
7. Epaway said...
A cut in interest rates is the worst thing that could have happened. The problem in this country is that people are too reliant and comfortable with debt. We start seeing a slow down - why? because people have stopped buying what they can't afford. So what does BoE do? Reduce rates to allow everyone their Christmas shopping.
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9. Will said...
What is this obsession with RPI? It includes housing costs - so stop suggesting it should guide the hand of BoE policy.
If you want them to pay attention to it now, will you also want them to respond to it next year as a HPC settles in?
Focusing on how RPI has spread from CPI since the end of 2005 (when housing inflation was also pretty stagnant) is just idiotic.
Get a graph of RPIX, or start campaigning for housing to be included in the inflation target. If the latter, this is probably not the forum for you.
10. lvmreader said...
Strong Economic Growth? Please....
11. george monsoon said...
Its by design, come on these guys are not stupid.
They are attempting to inflate us out of debt!
12. renting2 said...
Totally agree George. Risky, but will it work?
13. Sevensins said...
I hear gas is going up in Jan so I expect that rates will be held in Jan on a see how we go strategy and held again in Feb when inflation is seen to be rising
14. geed said...
I don't have any f*kcing Debt, what about me!!!!!!