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So which way?

Just had a conversation witha guy who has told me that interest reates will be dropped to zero to stimulate the economy........... I think I may have entered the twilight zone

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So which way?

Just had a conversation witha guy who has told me that interest reates will be dropped to zero to stimulate the economy........... I think I may have entered the twilight zone

That's a brilliant idea, why hasn't anyone thought of doing this sooner? It would surely work.

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No doubt Carney would be more likely to push IR down! I think it comes down to how weak the pound gets and if, big if, we get to see higher inflation feeding through. Remember though, CB's have been wanting higher inflation for ages now. So, even if we were to see 5%+ inflation, I wouldn't hold your breath about IR's rising just yet.

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Well the pound has fallen and the gilts yield has fallen. I would say the market is expecting a cut wouldn't you?

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Have said consistently on here for years that the politicians would rather trash the currency than raise IRs. That would hurt their chums too much.

Even today, after Brexit, the Leavers that are hoping to run the country remain silent. They too watch the currency being trashed , yet do nothing. Unless there's a master plan that I've missed ?

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Have said consistently on here for years that the politicians would rather trash the currency than raise IRs. That would hurt their chums too much.

Even today, after Brexit, the Leavers that are hoping to run the country remain silent. They too watch the currency being trashed , yet do nothing. Unless there's a master plan that I've missed ?

I think I voted in REFERENDUM not an election. Neither side had any power to promise anything. Its sad that so many seem to think that there must be some sort of plan from the Brexiters, they aren't a political party. We still have a Tory government and its their job to now take the majority result, however disagreeable it is, and implement it.

Both the Treasury and the BOE have plans how to handle what has happened which they are implementing.

My feeling is that there will be a point where the BOE will have to move rates. Carney would hate to raise rates so my belief is he'll find reasons to drop them.

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From the BEEB:

Negative interest rates in the UK?
Posted at

The market is pricing in a 15% chance of UK interest rates turning negative over the course of the next year, says Laith Khalaf from Hargreaves Lansdown.

That means that we could be paying banks to hold our money for us.

The market is now also giving a 50% chance of an interest rates cut in July, a 65% chance of a cut by August, and an 80% chance of a cut by the end of the year," his note adds.

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From the BEEB:

Negative interest rates in the UK?
Posted at

The market is pricing in a 15% chance of UK interest rates turning negative over the course of the next year, says Laith Khalaf from Hargreaves Lansdown.

That means that we could be paying banks to hold our money for us.

The market is now also giving a 50% chance of an interest rates cut in July, a 65% chance of a cut by August, and an 80% chance of a cut by the end of the year," his note adds.

Didn't Osborne promise us interest rate rises if we voted for Brexit?

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The barometer that the sh1t has well and true hit the fan, is surely the re-appearance on the older posters on here who haven't been here since 2008.

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Hmm, the pound being strong used to be a good thing (not IMO)

Now the weak pound is a bad thing but other things are worse.

Next they'll be giving money away.

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In September 2011 CPI was 5.2% and RPI 5.8%, the base rate stayed at 0.5%.

http://www.bbc.co.uk/news/business-15344297

They were not bothered about inflation, only asset prices and the situation is now far worse. Since then the governbankment have stoked up more household debt (inc via mortgages in banks they own, so they own the houses) and taken 20% to 40% shared equity in houses via HTB, guaranteed 20% of mortgages on existing houses via HTB2. Raising rates could crash house prices and the governbankment's housing liability is growing every day. So if house prices drop the currency should drop? So how does raising rates help, isn't it like shooting themselves in the foot?

Rock and hard place?

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In September 2011 CPI was 5.2% and RPI 5.8%, the base rate stayed at 0.5%.

http://www.bbc.co.uk/news/business-15344297

They were not bothered about inflation, only asset prices and the situation is now far worse. Since then the governbankment have stoked up more household debt (inc via mortgages in banks they own, so they own the houses) and taken 20% to 40% shared equity in houses via HTB, guaranteed 20% of mortgages on existing houses via HTB2. Raising rates could crash house prices and the governbankment's housing liability is growing every day. So if house prices drop the currency should drop? So how does raising rates help, isn't it like shooting themselves in the foot?

Rock and hard place?

The point is that they say one thing and do the opposite.

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The point is that they say one thing and do the opposite.

What? I didn't quote what they were saying just what they actually did in 2011 about inflation (nothing) and what they have done since (more household debt).

Our 10 year gilt yield just dropped to 0.93% this morning.

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£ really falling... Brexit really was the wrong result for an economy that relies on being a financial hub supported by property speculation. Jesus, we're nearly in the 1.2xx £/$

If it continues IR will have to go up.

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