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It's 0.25% Bump Every Month Boe Base Rate Thread ----Merged.


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HOLA441
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in 2 years they will be saying the same, screw the savers for another 2 years

Bank rate setters reject new cash injection as former colleague tells them to plan for rate rises...

Indeed ... I seem to remember spring / summer 2011 (?) them toying with the idea of a base rate rise and when each month when it didn't happen those heavily mortgaged colleagues (quite literally) skipping down the office.

This country is very sick, the overborrowed anmd overleveraged given preferential treatment against those who lived within their means and tried to remain 'sensible'. Oh for a time portal to 1997.

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Notable paragraph from the November MPC Minutes (my bold):

37 The Committee also discussed the likely effectiveness of reducing Bank Rate to below 0.5%.

Over the past few months, Bank staff had consulted with the FSA and the Building Societies

Association on the possible consequences. In the light of that, the Committee had re-examined in

detail the desirability of such an option. While it would be beneficial for some existing borrowers,

there were concerns that a cut in Bank Rate might prove counterproductive for aggregate demand as a

whole. Staff analysis had concluded that a further cut in Bank Rate would be likely to cause a

reduction in the profitability of some lenders, especially building societies, because of the prevalence

of loans with interest terms contractually or closely linked to Bank Rate. That would weaken their

balance sheets and they might have to respond by increasing other loan rates or restricting lending.

Viewed against the backdrop of the Funding for Lending Scheme (FLS), and the potential for building

societies to play a material role in increasing lending, the Committee judged that it was unlikely to

wish to reduce Bank Rate in the foreseeable future.

The MPC voted 8:1 for no change to Bank Rate and asset purchases. David Miles voted for a £25bn uplift in QE.

http://www.bankofengland.co.uk/publications/minutes/Documents/mpc/pdf/2012/mpc1211.pdf

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The MPC voted 8:1 for no change to Bank Rate and asset purchases. David Miles voted for a £25bn uplift in QE.

This must what it was like to live in Rome at the time Caligula made his horse a senator. All one can do is face-palm the abject stupidity of the Bank. There is no reasoning with them. They are insane.

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I bet you can't guess what they did?

Nothing... How unexpected!

I suspect they may try to avoid doing anything unless the economy really starts to slide before we get the new Gov'nor. We are in what the US would describe as lame duck season. Carney will need to formulate a QE exit plan very early on even if it stays on the shelf for 4 years.

If the Christmas period has been bad for trade and lots of firm hit the wall in January then I could see them going for a mini bout of QE in February as an outside chance but I suspect they believe FLS is doing all their work for them at the moment.

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http://uk.reuters.com/article/2013/02/20/uk-bank-bond-idUKBRE91J0CN20130220

The Bank of England's Monetary Policy Committee was split 6-3 on more bond purchases earlier this month, unexpectedly reviving the prospect that the central bank might restart its quantitative easing programme.

Bank of England governor Mervyn King, executive director for markets Paul Fisher and external MPC member David Miles all voted for an increase in the central bank's bond purchases to 400 billion pounds from 375 billion pounds.

An extra £25bn of funny money to save the economy.

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