Markets pricing in 3.5% rates by February

[scottbeard]

52 minutes ago, fellow said:

Why is it the former MPC members seem to suddenly know how to do their job AFTER they have left? 

The voting history of MPC members is all public.

Andrew Sentance voted to increase interest rates 20 times in the 56 meetings he attended, only voting 8 times to reduce them.

No-one before or since has voted to increase interest rates at the MPC more than Andrew Sentance (well except Mervyn King but that's more because he attended almost 200 meetings).

He was calling for a 0.5% rate rise back in 2011 (11 years before they did it) before being removed from the MPC.

Trying to suggest he has changed his tune since stepping off the committee is disingenuous.

[TheCountOfNowhere]

5 minutes ago, scottbeard said:

The voting history of MPC members is all public.

Andrew Sentance voted to increase interest rates 20 times in the 56 meetings he attended, only voting 8 times to reduce them.

No-one before or since has voted to increase interest rates at the MPC more than Andrew Sentance (well except Mervyn King but that's more because he attended almost 200 meetings).

He was calling for a 0.5% rate rise back in 2011 (11 years before they did it) before being removed from the MPC.

Trying to suggest he has changed his tune since stepping off the committee is disingenuous.

Sorry Andrew.

[dances with sheeple]

3.5 sounds on the low side?

[Social Justice League]

Inflation now running at 10.1%, so the BOE better act soon.

5%+ IR's are needed today imo.

[Nomadd]

3 hours ago, TheCountOfNowhere said:

if you bought 30 year treasury bonds in the 70s you made a killing.

Yep, that 10p a week spends could be worth a £10 by now.

[TheCountOfNowhere]

Just now, Nomadd said:

Yep, that 10p a week spends could be worth a £10 by now.

Not a bad rate of return

[TheCountOfNowhere]

1 hour ago, Social Justice League said:

Inflation now running at 10.1%, so the BOE better act soon.

5%+ IR's are needed today imo.

What was the outcome of their emergency meeting ?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

🤣🤣🤣🤣🤣🤣🤣🤣

[scottbeard]

2 hours ago, TheCountOfNowhere said:

What was the outcome of their emergency meeting ?

🤣

They said at the last meeting they EXPECTED inflation to go up to 13% by the autumn so being 10% now hardly merits an emergency meeting!

[TheCountOfNowhere]

46 minutes ago, scottbeard said:

They said at the last meeting they EXPECTED inflation to go up to 13% by the autumn so being 10% now hardly merits an emergency meeting!

That merited arrests.

[fellow]

6 hours ago, scottbeard said:

The voting history of MPC members is all public.

Andrew Sentance voted to increase interest rates 20 times in the 56 meetings he attended, only voting 8 times to reduce them.

No-one before or since has voted to increase interest rates at the MPC more than Andrew Sentance (well except Mervyn King but that's more because he attended almost 200 meetings).

He was calling for a 0.5% rate rise back in 2011 (11 years before they did it) before being removed from the MPC.

Trying to suggest he has changed his tune since stepping off the committee is disingenuous.

Fair enough. Not disingenuous, just ignorant.

[henry the king]

24 minutes ago, fellow said:

Fair enough. Not disingenuous, just ignorant.

Sentance is one of the good guys. 

You could make a good MPC. Haldane as governor. Saunders chief economist. Sentance too. Catherine Mann. Haskel. You can keep Ramsden. They have all shown they are credible about inflation.

The problem is almost entirely Bailey though. The dude just hasn't got a clue. Even if Pill was Governor he would probably deliver more rate rises. But Bailey is such a massive inherent dove that it holds everything back. He is a guy who wanted negative rates. He should be fired instantly.

Edited August 17, 2022 by henry the king

[HousePriceTooHigh]

Bailey and co are a disaster...

But just wait until the human hand grenade takes back control of the BoE. She'll pull an Erdogan and cut rates to 0%.

[TheCountOfNowhere]

Missed this today.. 

 

 

[fellow]

The Daily Mail have now picked up on this and predicting 3.75% by the end of next year.:

Interest rates to double by end of 2023: 'Ugly' inflation puts Bank of England on track to deliver multiple half-point hikes

https://www.thisismoney.co.uk/money/markets/article-11121211/Interest-rates-double-end-2023-Bank-fights-inflation.html

"Interest rates are expected to more than double by the spring after latest inflation figures added to fears that a period of spiralling prices will extend well into next year.

The consumer price index (CPI) measure of inflation rose to 10.1 per cent in July, up from 9.4 per cent the month before, according to the Office for National Statistics.

That was higher than the 9.8 per cent figure forecast by economists and prompted markets to pencil in the Bank of England raising interest rates to 3.75 per cent by March 2023".

[henry the king]

6 minutes ago, fellow said:

The Daily Mail have now picked up on this and predicting 3.75% by the end of next year.:

Interest rates to double by end of 2023: 'Ugly' inflation puts Bank of England on track to deliver multiple half-point hikes

https://www.thisismoney.co.uk/money/markets/article-11121211/Interest-rates-double-end-2023-Bank-fights-inflation.html

"Interest rates are expected to more than double by the spring after latest inflation figures added to fears that a period of spiralling prices will extend well into next year.

The consumer price index (CPI) measure of inflation rose to 10.1 per cent in July, up from 9.4 per cent the month before, according to the Office for National Statistics.

That was higher than the 9.8 per cent figure forecast by economists and prompted markets to pencil in the Bank of England raising interest rates to 3.75 per cent by March 2023".

Even if they go dovish and deliver 0.25% rises at the last 3 meetings this year that is still 2.5% which will still crash the housing market when it feeds through.

Takes a long time to feed through though. 

[Dreamcasting]

I'm really not sure why people are now concerned about house prices at this point. It won't just be the housing market that takes a deep dive. Your job, your savings, your pension, your investments, your own standard of living and overall happiness goes down with it.

[Bruce Banner]

27 minutes ago, Dreamcasting said:

I'm really not sure why people are now concerned about house prices at this point. It won't just be the housing market that takes a deep dive. Your job, your savings, your pension, your investments, your own standard of living and overall happiness goes down with it.

Now is not the time to be looking for ways to accumulate wealth, hanging onto as much as you can seems a sensible objective.

[scottbeard]

13 minutes ago, Bruce Banner said:

Now is not the time to be looking for ways to accumulate wealth, hanging onto as much as you can seems a sensible objective.

Right now probably so, but in the next 18 months there will no doubt be some fantastic buying opportunities on lots of assets.

The time to be greedy is when others are fearful, as the man said.

[Bruce Banner]

10 minutes ago, scottbeard said:

Right now probably so, but in the next 18 months there will no doubt be some fantastic buying opportunities on lots of assets.

The time to be greedy is when others are fearful, as the man said.

Yup, I'm expecting some good long term fixes on savings accounts and ISAs.

[TheCountOfNowhere]

11 minutes ago, Bruce Banner said:

Yup, I'm expecting some good long term fixes on savings accounts and ISAs.

It's all in the timing.

[BaldED]

On 8/17/2022 at 9:38 AM, bvrial said:

So what you're saying is they know whats going to happen before the BoE even knows?  

The stock market is a global opinion survey. As 1bn people where rates will be that will be your answer.

[Gemma Rose]

https://www.thisismoney.co.uk/money/markets/article-11121211/amp/Interest-rates-double-end-2023-Bank-fights-inflation.html

 

Love the graph. It reminds me of the Central line….. looks like they might have to reopen Ongar 😁

[Flat Bear]

On 17/08/2022 at 09:07, henry the king said:

https://www.bloomberg.com/news/articles/2022-08-17/traders-bet-bank-of-england-will-double-rates-in-next-six-months#xj4y7vzkg

The markets usually get these things right, they know what is going to happen before the BoE even know, or so it often seems. 

3.5% by February is a huge change from a year earlier.

Crashy crashy????

Sorry to take so long in responding to your opening post. I have been contemplating why and how we get to 3.5% by February.

I think "the markets" have got this right. They are not always right as there are areas of "the market" with group think but they are always more accurate and right than the BOE. Saying that I am much more accurate and right more often than the BOE as are a number of other posters. The BOE are absolutely useless, or are they deliberately giving false predictions?

I think that February the 2nd is the date penciled in for the first meeting of 2023 with the second meeting not until March the 25th.

My own prediction is for rates to be raised to 3.25% at the February meeting as the BOE raises as slowly as they possibly can. 0.5% Sept 0.5% Nov 0.0% Dec and another 0.5% in Feb 23. Bringing rate upto 3.25%

The contoversial one is the no raise in Dec which could be a small 0.25% raise an we have the 3.5%

It will seem a long time from there till the March 26th and we could well see a full percentage rise as inflation takes off again and the pound comes under sever pressure. Then things start to get very interesting.

[Flat Bear]

On 17/08/2022 at 10:16, TheCountOfNowhere said:

Just how high can mortgage rates go, 10% i'd say.

 

Interest rates to 6% but could just keep climbing.

Just how high can mortgage rates go, 10% i'd say.

Interest rates to 6% but could just keep climbing.

This is what people are starting to think.

If rates get to around 4% by the first half of the 2023 which is the most likely senario I would suggest that it will be extremely difficult to keep rates below 6% before the start of 2024 if inflation is seen to be persistent and or it stays above 10%.

The BOE's model only takes into account a sudden fall in inflation next year. Why will inflation do what the BOE predicts/wants? Inflation is not something the BOE can change by mind control or any further retoric. The BOE will continue with its low as possible interest rate policy for as long as it can even if does destroy the currency and the UKs economy along the way. 2024 and 2025 look even more ominous 

 

On 17/08/2022 at 14:06, dances with sheeple said:

3.5 sounds on the low side?

It is on the very low side but this fits in with the BOE's low as possible for as long as possible interest rate policy.

[henry the king]

53 minutes ago, Flat Bear said:

Sorry to take so long in responding to your opening post. I have been contemplating why and how we get to 3.5% by February.

I think "the markets" have got this right. They are not always right as there are areas of "the market" with group think but they are always more accurate and right than the BOE. Saying that I am much more accurate and right more often than the BOE as are a number of other posters. The BOE are absolutely useless, or are they deliberately giving false predictions?

I think that February the 2nd is the date penciled in for the first meeting of 2023 with the second meeting not until March the 25th.

My own prediction is for rates to be raised to 3.25% at the February meeting as the BOE raises as slowly as they possibly can. 0.5% Sept 0.5% Nov 0.0% Dec and another 0.5% in Feb 23. Bringing rate upto 3.25%

The contoversial one is the no raise in Dec which could be a small 0.25% raise an we have the 3.5%

It will seem a long time from there till the March 26th and we could well see a full percentage rise as inflation takes off again and the pound comes under sever pressure. Then things start to get very interesting.

I can't see any +0% meetings until wage growth and/or inflation is seriously down. I think that takes too long to happen before February. 

My personal guess is 0.5% in September and then 0.25% at the next 2 meetings to end the year at 2.75%. That is presuming the economy slows and unemployment starts to show the first signs of rising in October/November which stops 0.5% rises.

If the meeting was now a 0.5% rise is certain given the recent data, but next months data could be different. 

So it all really does depend on the data, but I think the base case is a 0.25% rise at every meeting and they only do different given specific data. Currently they have the data for a 0.5% rise in September but it is a long way off.