Jump to content
House Price Crash Forum
Sign in to follow this  
Surrey cash buyer

The Bank Of England

Recommended Posts

I STR'd back last September and have been following all the macro economic stuff ever since with a lot of help from hpc.co.uk. I wasn't following economic events very much previous to that and have never monitored the build up to a BOE rate change.

One thing that has become clear is that IR rate changes rarely come as a surprise. Every recent movement by the FED has been expected and the markets do not react to rate changes when they happen as expected. The same goes for the ECB and we know BOJ will certainly move either this month or next.

Does the same go for the BOE? When the next rate rise comes will we know it's coming before it happens? Will the hints be there in the rate meeting minutes months before it happens or could they possibly move upward, maybe even tomorrow, when the experts are least expecting it?

I'd appreciate some comments on this - many thanks.

Share this post


Link to post
Share on other sites

I STR'd back last September and have been following all the macro economic stuff ever since with a lot of help from hpc.co.uk. I wasn't following economic events very much previous to that and have never monitored the build up to a BOE rate change.

One thing that has become clear is that IR rate changes rarely come as a surprise. Every recent movement by the FED has been expected and the markets do not react to rate changes when they happen as expected. The same goes for the ECB and we know BOJ will certainly move either this month or next.

Does the same go for the BOE? When the next rate rise comes will we know it's coming before it happens? Will the hints be there in the rate meeting minutes months before it happens or could they possibly move upward, maybe even tomorrow, when the experts are least expecting it?

I'd appreciate some comments on this - many thanks.

http://money.uk.msn.com/Specials/Interest_...cumentid=143105

Surprise interest rate increase

By Ellen Cresswell

November 10 2005

The Bank of England has surprised economists and increased interest rates.The base rate has been increased to 4.75%.In September, inflation hit an eight-year high of 2.5

http://news.bbc.co.uk/1/hi/business/2733227.stm

Tuesday, 18 February, 2003, 21:41 GMT

Q&A: Surprise interest rate cut

The Bank of England has surprised most economists by cutting interest rates by one quarter of a percentage point.
After 14 months on hold, rates have been cut to 3.75%, taking borrowing costs to their lowest level since 1955.

You never know, they might spring a surprise on us tomorrow--the world is moving up and the B o E will not want to get too far behind making an even bigger rise necessary later.

Share this post


Link to post
Share on other sites

The BoE see statistical data before anybody else. If that deviates significantly from what the market expects, then, yes we could see a "surprise." I guess CPI is the unkown factor.

Share this post


Link to post
Share on other sites

http://money.uk.msn.com/Specials/Interest_...cumentid=143105

Surprise interest rate increase

By Ellen Cresswell

November 10 2005

The Bank of England has surprised economists and increased interest rates.The base rate has been increased to 4.75%.In September, inflation hit an eight-year high of 2.5

that's weird - the BOE HELD rates at 4.5% in November 2005!!!!! if I'm not mistaken.. :huh:

Edited by Sisyphus

Share this post


Link to post
Share on other sites

The BoE see statistical data before anybody else. If that deviates significantly from what the market expects, then, yes we could see a "surprise." I guess CPI is the unkown factor.

Good point karhu, thanks. I had noticed that the CPI data is always published shortly after the rate meeting and had wondered if they would have seen it.

that's weird - the BOE HELD rates at 4.5% in November 2005!!!!! if I'm not mistaken.. :huh:

Think the msn calendar has slipped a year.

Share this post


Link to post
Share on other sites

http://money.uk.msn.com/Specials/Interest_...cumentid=143105

Surprise interest rate increase

By Ellen Cresswell

November 10 2005

The Bank of England has surprised economists and increased interest rates.The base rate has been increased to 4.75%.In September, inflation hit an eight-year high of 2.5

http://news.bbc.co.uk/1/hi/business/2733227.stm

I must've missed that rate change ;) . As far as I am aware the most recent movement was down in August!!!!

Share this post


Link to post
Share on other sites

reporters say it was a surprise occassionally. but to who was it a surprise?

their readers...who probably no sweet FA

to the financial community/ traders ...folks with billions riding on movements/postions such as this...its rarely a surprise. if it was a real surprise to the market then the all hell would break loose in the market. BoE does not want that.

Share this post


Link to post
Share on other sites

Think the msn calendar has slipped a year.

nope November 04 rates did not move either - I think the last hike was from 4.5% - to 4.75% in AUG 04, which the market had expected....

Edited by Sisyphus

Share this post


Link to post
Share on other sites

reporters say it was a surprise occassionally. but to who was it a surprise?

their readers...who probably no sweet FA

to the financial community/ traders ...folks with billions riding on movements/postions such as this...its rarely a surprise. if it was a real surprise to the market then the all hell would break loose in the market. BoE does not want that.

Follow da' moneee. Where is it going now? Stocks seem to be on a broad retreat worldwide.

Share this post


Link to post
Share on other sites

And don't forget that during the Soros exchange rate mess, the BoE raised rates massively in one day - outside of their normal monthly reporting.

So, if there is a big mess mid-month, they have the capacity to do a one-off adjustment.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.