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Will They Raise Rates Tomorrow?


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My feeling is that we at a tipping point with regard to public attitudes to inflation where a bit of direct action might change the media agenda and embarrass the BOE into actually doing something.

zimbabwe-inflation-money-becomes-wallpaper.jpg?w=495&h=373l

"Thanks to Merv & the MPC the pound will soon be wallpaper"

Anyone up for plastering the BOE with posters & Zimbabwean dollars?

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I reckon they could get away with several 0.25% increases this year before they even touch inflation. The first rise will be as RBs article says to maintain credibility and to be shown to be acting to control it. Just to settle the markets and prove (?) they are in control.

Probably not today but Feb or march

Edited by Pent Up
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There was a chap from the Spectator on 5 Live this morning confirming my belief that the BoE are allowing break-kneck inflation to inflate the national debt away.

Trouble is, they're not even achieving that. Tax revenues - the thing that will actually be used to pay the national debt - are going nowhere. Rising food/energy/housing prices and stagnant wages are making the national debt harder to service, not easier.

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I reckon they could get away with several 0.25% increases this year before they even touch inflation. The first rise will be as RBs article says to maintain credibility and to be shown to be acting to control it. Just to settle the markets and prove (?) they are in control.

Probably not today but Feb or march

Problem is, should they do that, then I (along with goodness knows how many others who are on very low base-rate linked SVRs) am going to go for a fixed rate ASAP. I wonder what effect several hundred thousand people simultaneously trying to remortgage would have on the market..

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Not today no, but inflation feeds through to wage demands, some sectors like BT have managed it (they were awarded 9.3%). It'll trickle through.

I'll believe it when I see it. Unemployment is high, profits are poor in many industries, and the public sector is laying off thousands. This is not a strong bargaining position for workers.

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I'll believe it when I see it. Unemployment is high, profits are poor in many industries, and the public sector is laying off thousands. This is not a strong bargaining position for workers.

Yes, Tesco announce 0.6% increase in sales (pretty dire when you consider inflation) and Halfords down over 6%.

Bad numbers coming through now.....

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I don't think interest rates will go up for a long time. Ask yourself these questions.

Has the UK been living beyond it's means for the last 30 years importing more than we export?

Do you think we will be poor now?

There are two ways of us becoming poor ether we get wage cuts or things we buy will get more expensive

Which way would the government choose to make us poorer?

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I reckon they could get away with several 0.25% increases this year before they even touch inflation. The first rise will be as RBs article says to maintain credibility and to be shown to be acting to control it. Just to settle the markets and prove (?) they are in control.

+ 1

Probably not today but Feb or march

Or April or May. I have no idea.

BUT! I just had an insight! The amount of delaying will be an indicator for how much they want/will/won't control inflation. The sooner they do it, more serious they will be (or just "appear" to be? ... sh!t, got confused with my insight now... :( )

Edited by Tired of Waiting
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Problem is, should they do that, then I (along with goodness knows how many others who are on very low base-rate linked SVRs) am going to go for a fixed rate ASAP. I wonder what effect several hundred thousand people simultaneously trying to remortgage would have on the market..

Would you? Remember those fixed rates won't look so appealing the moment the first rise is announced.

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The interesting bit of the minutes is how they worry a lot about inflation expectations. Currently only 1 of the 10 members wants an increase. Once 1 more changes his/her mind, it'lll generate more press about inflation expectations, and the rest will change their minds as a result of a self-fulfilling prophesy.

Thats my hope anyway, but not convinced it'll happen anytime soon.

5 minutes to go....

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The interesting bit of the minutes is how they worry a lot about inflation expectations. Currently only 1 of the 10 members wants an increase. Once 1 more changes his/her mind, it'lll generate more press about inflation expectations, and the rest will change their minds as a result of a self-fulfilling prophesy.

Thats my hope anyway, but not convinced it'll happen anytime soon.

5 minutes to go....

And that was before inflation expectations took a big jump in December.

Nothing for now. Have to wait for the minutes to see if we got any more votes.

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Would you? Remember those fixed rates won't look so appealing the moment the first rise is announced.

Interesting question; I'm with Nationwide on a effectively lifetime BOE+2% rate, which I lose if I remortgage. But I think a lot of people would be spooked..

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