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Sterling Rises On Strong Uk Mortgage Data

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Sterling edged up on Tuesday as strong British mortgage data added to concerns that the housing market may be overheating, reinforcing expectations the Bank of England may raise rates sooner than previously expected. The number of mortgages extended for home buying rose to 45,044 in November from 43,315 in October, their highest level since December 2009, the British Bankers' Association said. British 10-year government bond yields were close to their highest level since mid-September, peaking at 2.994 percent. "Moving into year-end the pound looks like it's set to outperform alongside the robust recovery in the UK economy, which we think will put pressure on the Bank of England to raise its interest rate by the end of (2014) or early 2015,"

"It looks like the Bank of England may be the first major central bank to raise rates." Link

But what is gold doing?

Edited by rollover

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But what is gold doing?

Gold is doing what it always has done. Just sits there all shiny and metallic looking.

As far how the CPI/RPI going lower with the price of gold and HPI going up. I have no idea. Gold was in all likelihood too high and has been going through a correction as all asset classes do. (expect houses, they pay you a guaranteed income and always go up in value, so it doesn't matter when you buy! :P)

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Oh and George has told him not to raise interest rates, plus Cameron is always banging on about low interest rates and how good they are, so the chances of a rise before the election are still non-existent.

What UK politicians tell UK bankers to do is irrelevant, interest rates will rise as soon as the USA starts raising their interest rate, just as we had to raise our interest rate in the early 1990s because Germany raised theirs to pay for re-unification.

I personally expect rates to start rising this year. The Government are obviously looking towards the 2015 election but I don't think they'll be to worried about the effect of this as not many mortgagors are paying SVR, therefore the cost of the mortgage will not rise until people come off of fixed two and three year deals after the election.

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Sterling edged up on Tuesday as strong British mortgage data added to concerns that the housing market may be overheating, reinforcing expectations the Bank of England may raise rates sooner than previously expected. The number of mortgages extended for home buying rose to 45,044 in November from 43,315 in October, their highest level since December 2009, the British Bankers' Association said. British 10-year government bond yields were close to their highest level since mid-September, peaking at 2.994 percent. "Moving into year-end the pound looks like it's set to outperform alongside the robust recovery in the UK economy, which we think will put pressure on the Bank of England to raise its interest rate by the end of (2014) or early 2015,"

"It looks like the Bank of England may be the first major central bank to raise rates." Lin

Low interest rates = strong mortgage data ,strong mortgage data = strong £ = higher interest rates (gilts are saying the same) it don`t look like they can have both now ,is this the markets waking up?

Are TPTB going to have to choose which one to talk/manipulate down? or is this just the beging of the end using the ""Money Masters"" central bankers game plan

Edited by long time lurking

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..to rise on 'strong mortgage data'...is a joke ..we all know this is a farce and it reflects the emotional whims of the FX markets....all lemmings diving over another cliff face ...and a measure which stunts our exports while we ponder the fluff on our belly buttons.... :rolleyes:

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One thing I've learned over the years is that interest rates move sharply when nobody is expecting it.

And what's more irritating is that this rise in the value of sterling does not relflect a strong economy, but just a pumped up property market. In fact we have a very wobbly manufacturing and exporting sector - exports have been falling in recent months. A rise in sterling will make that trend even more likely. The very policy of house pump prime will actually choke off the rather tame recovery in manufacturing and exporting that appeared for a while. The balanc of payments are the worst for 25yrs and savings at their lowest for 40 yrs. All this signals is trouble ahead. The pound should be falling, so this is a distortuon we just don't need. Rising interest rates actually are needed to restore a functioning real economy. Carney has no clue and has left Canada in a house price bubble mees he created.

I do think the unexpected will happen in 2014-15 and before the election.

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And what's more irritating is that this rise in the value of sterling does not relflect a strong economy, but just a pumped up property market. In fact we have a very wobbly manufacturing and exporting sector - exports have been falling in recent months. A rise in sterling will make that trend even more likely. The very policy of house pump prime will actually choke off the rather tame recovery in manufacturing and exporting that appeared for a while. The balanc of payments are the worst for 25yrs and savings at their lowest for 40 yrs. All this signals is trouble ahead. The pound should be falling, so this is a distortuon we just don't need. Rising interest rates actually are needed to restore a functioning real economy. Carney has no clue and has left Canada in a house price bubble mees he created.

I do think the unexpected will happen in 2014-15 and before the election.

so, you dont expect the expected unexpected to happen just yet.

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so, you dont expect the expected unexpected to happen just yet.

UK plc is currently in the position of running Public sector net debt of £1,211.8 billion (and rising sharply) at the end of September 2013, equivalent to 75.9% of GDP. When the financial crisis started it was under 40%. Source My link

The economy is 2% smaller than it was then, but the debt ratio has nearly doubled!

Go figure.... Recovery my a..e! :unsure:

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How can they raise rates as none of Carney's forward guidance criteria have been met or breached. And he has stated before that the BoE is not there to control asset prices and in particular property ... quite the opposite, Carney would like a property bubble as it makes GDP look good. Oh and George has told him not to raise interest rates, plus Cameron is always banging on about low interest rates and how good they are, so the chances of a rise before the election are still non-existent.

It looks like some of the conditions of forward guidance will met soon enough.

The bank of England is concerned about the property market. The reduction on capital relief for HTB is a start. There have been several other comments from leading Bank figures recently raising concerns about the property market.

The property market is not the Bank's primary concern, but if it contributes to financial instability it becomes a prudential concern.

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When the conditions of forward guidance are met they will THINK about raising interest rates, there is no commitment.

Carney and Osborne want a property bubble and a massive bubble did not lead to problems in Canada and in any case how big can it blow before may 2015? No big enough to cause financial instability is my guess ... could easily be wrong as no one saw it coming last time either as it started in USA.

The so called bubble is slowly deflating, has been since the "crisis" started, there is no chance of anything even remotely like that bubble happening again in our lifetimes, the rest is just media ( and bull poster) imaginings.

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When the conditions of forward guidance are met they will THINK about raising interest rates, there is no commitment.

Carney and Osborne want a property bubble and a massive bubble did not lead to problems in Canada and in any case how big can it blow before may 2015? No big enough to cause financial instability is my guess ... could easily be wrong as no one saw it coming last time either as it started in USA.

They don`t, they want to be elected, or stay in post until time to collect the big payoff in Carneys case, and run a system that allows them and their mates to skim off the top, the way things are going now the very policies they started are in danger of hurting the banks and markets i.e the 1%? Blowing housing bubbles is yesterdays news.

As I read it they have run policy to enable the banks to get stronger as long as they possibly can, now they will attempt to tighten a bit, and let those who have no or low mortgage accept that they have to drop their selling price so the bank can get new business, and hope that somehow the shuddering wreck of the UK economy can keep going towards some sort of stability. It probably can`t without a proper bust, but they will try, and lets be honest, they have done not a bad job so far, personally I have felt no financial pain whatsoever during all of this, especially since I got totally clean of any kind of debt.

Edited by dances with sheeple

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Of course they want to be elected and they see the best way is to get the feel good factor from rising house prices. If not why did they introduce FLS, HtB 1 and HtB 2? An idiotic scheme condemned by many as a foolish way to create a housing bubble. That and triple guarantee for the pensioners' votes. The whole UK economy is dependent on housing and recent growth is on the back of a so-called recovery in the property market. Blowing bubbles is very much news all across all MSM.

Nonsense, if "rising" house prices created a "feel good" factor retail would be booming, it isn`t, and it isn`t because there is a LOT less MEW and other credit to go around? The statistical price of your house no longer translates into money in your pocket (or on your plastic)

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Of course they want to be elected and they see the best way is to get the feel good factor from rising house prices. If not why did they introduce FLS, HtB 1 and HtB 2? An idiotic scheme condemned by many as a foolish way to create a housing bubble. That and triple guarantee for the pensioners' votes. The whole UK economy is dependent on housing and recent growth is on the back of a so-called recovery in the property market. Blowing bubbles is very much news all across all MSM.

And as I said on another thread about twitter/facebook, if the bbc are telling you to do it/it is happening, IGNORE THE MESSAGE, it will really not be happening and they have another agenda. My take on the agenda is that they are slowly manipulating prices down by letting home sellers think they are supported, but introducing the higher rates meme as well, they are giving with one hand but taking with the other, they want to be seen to be "helping", but they also need to be seen to be responding to the "recovery". They also know that a very large chunk of voters now want lower house prices and higher rates.

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Well IIRC mortgage lending is up 37% on a year ago, and why are HtB 1 and HtB 2 key government policies if not to get elected on the back of rising property prices?

Up from what though? The policies are about "getting on the ladder" more than "rising prices" they are accepting that prices are too high for ordinary people, but they probably planned to call "BUBBLE" soon after it started and cancel it all anyway? It is just panto politics, if you have no loans with the banks they do not give a stuff how much you "lose" when you eventually sell your house.

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Prices are not going down in London and SE and HtB 1 and HtB 2 are pushing up prices there. Not in the rest of the country but all that matters is London and SE. George has stated he wants a property boom, Carney has history, people love HPI, even labour have not said a word about lowering house prices, just some waffle about reducing the elec bill by £50 per year.

You bang out that line a lot. The rest of the country doesn`t care about London and the SE, if people want to live there in commuter and housing cost hell, that is their problem not mine, all I know is that bubble prices around me are going out faster than a rip tide.

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The USA are also committed to low rates for years as well, they have adopted the same approach as Carney, which is why the taper actually caused the stock market to rise. The commitment to low interest rates more than off-set the lose of $10bn of fresh cash every month.

Not true. Stock markets rose because the dealers had been flush with QE cash from the middle of the month onwards but with very little new Treasury debt available for them to buy. The surplus cash has to be put to work somewhere. Stocks would have risen regardless of the Taper announcement.

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Whether right or wrong government policy is all about growing London and SE at the expense of the rest of the country. Has been in the past with the 'unemployment in the North is acceptable ....' speech a few years ago and is now. Sure the rest of the country does not care about London and SE but more importantly (wrongly IMHO) London and the government does not care about the rest of the country except as something to exploit if they can.

It is ordinary Londoners who are being exploited, not the rest of the country, it is they who are going to suffer when it all goes pop because they have been forced/persuaded that taking on massive debt is the only way to sustain the desired lifestyle.

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It is ordinary Londoners who are being exploited, not the rest of the country, it is they who are going to suffer when it all goes pop because they have been forced/persuaded that taking on massive debt is the only way to sustain the desired lifestyle.

But do you really think that?

Surely, as in the past, the SE will be insulated to some degree and wealth with continue to be sucked out of the rest of the UK. I live in the Midlands and in this seasonal holiday by SE relatives simply flat out cannot believe that my house is worth less than in 2007.

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But do you really think that?

Surely, as in the past, the SE will be insulated to some degree and wealth with continue to be sucked out of the rest of the UK. I live in the Midlands and in this seasonal holiday by SE relatives simply flat out cannot believe that my house is worth less than in 2007.

This is the sort of thinking that confuses me, threads on here would lead us to believe that HALF of all outstanding mortgages in London are I.O, that doesn`t sound like "wealth" to me. Most average people in London are over borrowed or on some kind of benefit to pay for their living expenses? That sounds like poverty to me, the worst kind of poverty where you are owned lock stock and barrel by a bank. It isn`t possible to insulate against that sort of mess where so many are clutching at the live wire of future interest rate rises, when it goes up they will blow up, and nothing can be done.

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