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Cbi Forecasts Interest Rate Will Reach 2% Next Year

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http://business.timesonline.co.uk/tol/busi...icle6845029.ece

The Bank of England will start to raise interest rates next spring and could take the cost of borrowing to 2 per cent by the end of next year, according to the latest CBI economic forecasts.

The Bank has held rates at a record low of 0.5 per cent to help businesses and consumers to contend with the recession, but the central bank will need room to act in the coming months if inflationary pressures become a worry, the employers’ organisation said. Ian McCafferty, the CBI’s chief economic adviser, said that he expected inflation to be volatile next year, renewing pressure on the Bank.

:D

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Once Base Rate became a political tool it lost all relevance to the real economy.

Interest rates are already much higher than 2%

Yorkshire BS are now offering a fixed rate 5 year bond at 5.3%

So obviously the experts are expecting REAL rates to be above 5% in the very near future.

Mervin King is a clown and once the BOE decided to ignore economic reality base rates became irrelevant.

IMHO

:blink:

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I was thinking about all the people on SVR and tracker deals, they will $hit themselves when rates go up. Rates up, house prices down affordability and all that.

Well Yes.

Interest rates can only go one way from here.

Anyone with any sense knows that it is far better to buy a house and take out a mortgage when interest rates are at 15% than when they are at 1%.

If you take a mortage out when rates are at 1% you will pay too much for the house and your payments could easily quadruple.

If you take a mortgage out when rates are at 15% the house will have been cheap and your payments could easily fall 2 or 3 times.

All the people who moan about high interest rates under the Conservatives should stop swallowing BBC and Nu Labour propaganda.

:blink:

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When we see rates at 10%, then people really will start emptying their bowels.

Roll on 2010....%!!

I won't.

I will be filling my boots!

Because I was one of Thatchers children - ordinary working class people who under a generation of Conservative rule, got a job, bought a home, paid off the mortgage, saved up a big nest egg then gave up work.

What have ordinary working class people been able to achieve under a generation of Nu Labour rule?

As someone else here keep saying

WAKE UP!

:blink:

Edited by Game_Over

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Well Yes.

Interest rates can only go one way from here.

Anyone with any sense knows that it is far better to buy a house and take out a mortgage when interest rates are at 15% than when they are at 1%.

If you take a mortage out when rates are at 1% you will pay too much for the house and your payments could easily quadruple.

If you take a mortgage out when rates are at 15% the house will have been cheap and your payments could easily fall 2 or 3 times.

All the people who moan about high interest rates under the Conservatives should stop swallowing BBC and Nu Labour propaganda.

:blink:

probably one of the most important and succinctly put very likely truths ever posted here

Edited by loginandtonic

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probably one of the most important and succinctly put very likely truths ever posted here

Thanks.

If you are going to buy a house, then high interest rates are a very good thing.

Anyone buying a house when interest rates are lower than 5%, is just asking for trouble.

And they will inevitably get it.

Edited by Game_Over

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I won't.

I will be filling my boots!

Because I was one of Thatchers children - ordinary working class people who under a generation of Conservative rule, got a job, bought a home, paid off the mortgage, saved up a big nest egg then gave up work.

What have ordinary working class people been able to achieve under a generation of Nu Labour rule?

As someone else here keep saying

WAKE UP!

:blink:

I meant those with mortgages, loans and zero savings. Most on here want Merv to get his finger out and get them up.

Me included.

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Im interested in the BOE +2.49% life time trackers. It seemed like a stupid idea in the first place once rates go above 2.2% fixed rate would be better, if it goes back to 5%+ these products are going to be defunct. They should have capped the tracker 2.49% normal service resumes above this level.

Something tells me this is a get 6% interest for a year account then 0.000001% there after kind of deal. Woops your interest is now 7.49% and the boe is 5 really how awful.

Edited by pathfinder

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probably one of the most important and succinctly put very likely truths ever posted here

except rates were AT 15% ( half a day) at shortly after peak prices......they were raised to support the pound against the ERM.

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probably one of the most important and succinctly put very likely truths ever posted here

except rates were AT 15% ( half a day) at shortly after peak prices......they were raised to support the pound against the ERM.

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except rates were AT 15% ( half a day) at shortly after peak prices......they were raised to support the pound against the ERM.

Not sure how I bought a five bedroom house in the 80's while earning average wages and paid off my mortgage in under 10 years.

I must have been dreaming.

:blink:

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The Bank of England will start to raise interest rates next spring and could take the cost of borrowing to 2 per cent by the end of next year

Shudders!

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I was thinking about all the people on SVR and tracker deals, they will $hit themselves when rates go up. Rates up, house prices down affordability and all that.

Yeah, when BOE base rate goes up to 2% my mortgage will go up to 2.17% absolutely $hitting myself. Don't know how I will cope...

:rolleyes:

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Yeah, when BOE base rate goes up to 2% my mortgage will go up to 2.17% absolutely $hitting myself. Don't know how I will cope...

:rolleyes:

someone else with a c&g mortgage then

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Not sure how I bought a five bedroom house in the 80's while earning average wages and paid off my mortgage in under 10 years.

I must have been dreaming.

:blink:

maybe you didnt live in east anglia where my 5 bed went to £235,000.

last boom didnt affect all areas.

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Are you a low swinging genital?

and it has conditions:

You can only make deposits to the e-Bond whilst it remains open to new investors. However, the e-Bond is a limited issue product, which means it can be withdrawn without notice at anytime

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and it has conditions:

You can only make deposits to the e-Bond whilst it remains open to new investors. However, the e-Bond is a limited issue product, which means it can be withdrawn without notice at anytime

Well they always have conditions, the main one being you have to have the money to invest. ;)

Next year I will get a 2 year fix at over 5%, I will be quite happy with that.

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Im not sure where everyone gets the idea that interest rate rises will cripple everyone.

Some, yeah. But most of thje people I know could afford the mortgage at 5% with a fair amount spare.

Im on a tracker that finishes in November and whilst its been nice to overpay the mortgage for a bit, ill settle for a 4.24 SVR for the timebeing and fix when rises look inevitable.

Im all for affordable housing - and I hope prices drop another 20% or so - but no TOO much as I dont want to be in NI (yes I have a VI) - but some of you guys are very blinkered about the general public.

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