Wednesday, Aug 02, 2006

Under Pressure...dun, du, du, dun, dun...

MoneyWeek: Why the Bank of England should raise interest rates

Interest rates are continuing to rise across the globe. With inflation above forecasts in most countries, its no surprise that central banks are getting twitchy.

The Reserve Bank of Australia raised the countrys key interest rate this morning. It now stands at 6%, the highest its been in nearly six years.

The European Central Bank is seen as almost certain to raise rates this week, to 3%.

But even though UK inflation is well above the Bank of Englands target level, a majority of economists still expect the key rate to remain at 4.5% when the Bank announces its latest rate decision tomorrow.

Posted by tyrellcorporation @ 09:55 AM (431 views)
Add Comment
Report Article

3 Comments

1. paul said...

Of course, I will feel compelled to repeatedly ridicule Uncle Tom at every opportunity if his "no change" prediction is wrong*.

Phew, with all the parping from bulls claiming that there's no case for a rise, this offers some respite. It will be a close call, and as I've said the MPC won't be able to keep everyone happy whatever they decide tomorrow. And as MoneyWeek rightly says wage inflation is very difficult to stop once it starts, and once it starts it spirals upwards. We'd very quickly have hyperinflation and an economy like that of Chile, or the Congo perhaps*.

* Not strictly true.

Wednesday, August 2, 2006 10:59AM Report Comment
 

2. Sloth said...

As we've seen, voting for a rise in interest rates can put serious strain on the heart.

Wednesday, August 2, 2006 01:40PM Report Comment
 

3. paul said...

Very dark humour, Sloth!

Wednesday, August 2, 2006 04:01PM Report Comment
 

Add comment

  • If you do not have an admin password leave the password field blank.
  • If you would like to request a password allowing you to add comments and blog news articles without needing each one approved manually, send an e-mail to the webmaster.
  • Your email address is required so we can verify that the comment is genuine. It will not be posted anywhere on the site, will be stored confidentially by us and never given out to any third party.
  • Please note that any viewpoints published here as comments are user's views and not the views of HousePriceCrash.co.uk.
  • Please adhere to the Guidelines
Username  
Admin Password
Email Address
Comments

Main Blog | Archive | Add Article | Blog Policies