Wednesday, Aug 09, 2006

More rate rises on the way?

BBC News: Bank hints at further rate rises

The Bank of England has hinted that UK rates may have to rise further in coming months in order to keep inflation on target at 2%.

Posted by bigwavedave @ 11:20 AM (496 views)
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1. George Monsoon said...

Hmm .. We could do to raise interest rates again, because inflation is running wild. Problem is, that if we actually do raise interest rates again and get it wrong, we will look extremely bad. Tell you what, lets make it public knowledge that we are probably going to raise rates again, this will scare enough people into not overspending and we may not need to raise rates at all. That way we can boil the frog for a few more months....

Well thats how I see it anyway. Apologies to all the experts who visit this site, with more educated opinions than mine .

Wednesday, August 9, 2006 11:45AM Report Comment

2. Delboypass said...


THEY NEED TO BE ABOUT 6% or 7% to encourage savers and reduce the debt burden - everyone knows this...get them up fast and blame inflation!!

Wednesday, August 9, 2006 12:20PM Report Comment

3. Thesqueeze said...

'Expert' economists at the mortgage lending companies will see this as in no way helpful for the housing market, and in many respects 'simply unnecessary', because after all it stops them making as much money, I mean don't the BoE realise this?, it's unjust.

The estate agents will say to everyone that things are okay and that you still can't lose money in property, if you look at the curve that is and not the huge troughs or the massive peak on the right hand side of the chart. They will still assure new buyers that they do not expect the rate to rise (despite your average estate agent not having much above a CSE). Well if the housing market does crash I guess they can always get proper jobs.

The BBC will put positive spin on it and the Vicky Pollards of this world won't take notice of this warning, afterall you don't have to pay back the money these days. 'Innit'.

Let the economics dictate I say...let 'em suffer, the more jitters in the market, the more people are going to do crazy things, like offer 20% off the asking price, ludicrous I know but when I got my first house I did this, negotiated a price. Maybe news of rates going up will encourage more people to save, or get a pension, crazy things like that....

Wednesday, August 9, 2006 12:55PM Report Comment

4. Ticktock said...

Maybe news of rates going up will encourage more people to save, or get a pension, crazy things like that....

Unfortunately, 'real' inflation is so much higher than IRs that both savings and pensions are a complete waste of time. You will 'loose' money in either, as our currency is constantly & continualy devalued via the 'hidden' methods of Central Banks (and the greater powers that control them)
Our banking system is a fraud (much like our government) and paper money is always eventualy reduced to its true value. That of paper.

Wednesday, August 9, 2006 01:51PM Report Comment

5. Inflation Is Eating My Savings said...

The comment by ticktock is correct- whilst most the indicators point to a hpc- with m4 data showing 14% more paper out there, it also seems ridiculous to hold cash and wait.
FYI: Housing my home town of Dundee is booming still. There is a resurgent economy with the biotech sector. Everyone is buying (even after a 3 year boom). It might be a microclimate effect or just the last ripple of the passing steamer. However, I still don't feel like putting my cash on the line- in spite of the BofEs rather British tendency to talk rather than act. For the greater good (there is an excess of greater fools over us cynical bears remember)- their line probably makes sense- hint at danger rather than unbalancing things for other sectors. On the plus side- it doesn't seem like many of the recent pay settlements have resulted in inflationary hikes (lecturers get c. 4% each year for the next 3 years)- so unless I'm even more naive than I think- it won't be hyperinflation like in the 70s.

Wednesday, August 9, 2006 03:37PM Report Comment

6. Thesqueeze said...

Ahhh, so money isn't worth anything as an investment or in its paper makeup. In that case ticktock, if you get any spare please send it to me! It's of no use to you and seems to frustrate you ! :)

Wednesday, August 9, 2006 04:18PM Report Comment

7. George Monsoon said...

I have no money. I remain unaffected. Everything always costs too much!


Wednesday, August 9, 2006 04:33PM Report Comment

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