Tuesday, September 2, 2008

Now way they can cut rates now

Sterling hits new lows

The pound has fallen to a record low against the euro and a two-and-half-year low against the US dollar amid fears about the health of the UK economy. Against a basket of currencies used by major trading partners, the pound is now at a 12-year low.

Posted by little professor @ 12:03 PM (1844 views)
Please complete the required fields.



22 thoughts on “Now way they can cut rates now

  • little professor says:

    Sorry, should be ‘no way’, not ‘now way’

    Reply
    Please complete the required fields.



  • Australia has just trimmed rates. Canada declare rates next.

    Surely, if Gordo wants parity with the Euro, a rate cut makes sense (joke)!

    Reply
    Please complete the required fields.



  • My Autumn holiday in Spain is getting more expensive by the day – how long before £1 = 1 Euro ?

    UK Plc will be third world by 2018.

    Reply
    Please complete the required fields.



  • I believe the long term average is around 1.60 to the $ so the GBP is still way over priced. Market already assumes IR are going to be slashed.

    Reply
    Please complete the required fields.



  • The fall in sterling is the result of an expected rate cut. My guess it will happen. Race ya to the bottom !

    Reply
    Please complete the required fields.



  • What’s interesting here is the disconnect between the $ and the £. The £ is being trashed against the € while the $ is bouncing. Looks the the central bank intervention is being limited to the $ while the £ is being “let go”.

    Reply
    Please complete the required fields.



  • This is as a result of an expected rate cut at the next MPC meeting. Probably .25%

    Reply
    Please complete the required fields.



  • the fall is result of the weakness of uk economy in this enviroment. look at the uk: it is just finance and real estate. what else do we do?
    on top of that, uk lives on london money – mainly foreing money. and what the brow the genious is doing for them? taxing them.
    sorry but capitalism is not dead, governament should help the uk economy as it is too late to convert it.

    Reply
    Please complete the required fields.



  • denzil @ 7

    “This is as a result of an expected rate cut at the next MPC meeting. Probably .25%”

    If they do then expect parity with the Euro by christmas

    Reply
    Please complete the required fields.



  • george monsoon says:

    Would I make any money if I put all my savings into euro’s?

    Reply
    Please complete the required fields.



  • Nearly there, just need a miners strike and a re-run of Boys from The Blackstuff.

    Reply
    Please complete the required fields.



  • @9. george monsoon said…Would I make any money if I put all my savings into euro’s? – potentially yes, assuming Sterling continues to depreciate against the Euro – eg when u switch back to Sterling you will potentially pick up more Pounds in exchange.

    In terms of risk investors profiles (in simple terms) are No Risk, Low Risk, Medium Risk & High Risk

    Currency speculation fits into the High Risk category.

    Reply
    Please complete the required fields.



  • ontheotherhand says:

    So whenever Darling blames UK problems on international conditions he should be reminded that deficit spending is helping to kill the pound and erode what our salaries buy. For example as oil pushes back down through $100 per barrel will we see any difference at the petrol pump where we have to buy with sterling?

    Reply
    Please complete the required fields.



  • Nu Labour? Same old Labour in my book. Still can’t be trusted with the economy.

    Reply
    Please complete the required fields.



  • I’ve just come back from Lakeside in Essex, and on this tuesday morning it was very busy indeed. in fact the last couple of times i’ve been there it has been busy. As recent sales reports have shown ( suprisingly good sales figures), I don’t believe people are in as bad a position as some would have us believe, I think it’s all just a ploy to bring interest rates down and reignite the housing market.

    Reply
    Please complete the required fields.



  • I’m with you there Jolo. Plenty of people at the checkouts when I’m out shopping. There’s even plenty of property sold in the last two months too.
    All the builders I know, have more work than they can shake a large stick at. The one area of problem is new builds typically targetted at the BTL, which looks grim, but as they say in “DRagons Den”, if you produce a product that nobody wants or can afford then your business model is pointless.

    Reply
    Please complete the required fields.



  • george monsoon, I don’t think so. Maybe for 2-3 months. Europe will be hit as well – mainly Sapin. On think for sure is that in 1-2ys view you should put money in us dollars

    Reply
    Please complete the required fields.



  • @15 & 16.. Interesting observation.. I do not doubt, the number of people shopping.. the questions I would ask:

    1. Are the shoppers, shopping more but buying less than they would on average?

    2. Are the shops margins still as good?

    3. Are people buying, with concerns that products will cost more in the future? (inflation)

    4. Is shopping another form of addiction? If so, people will shop for escapism, pretty much like someone indulging in drugs, gambling, alcohol or sex.

    As for sterling, yes, going down like an es-cort on a pol-itician at the mo… But been buying Gold Sovereigns, and despite the reduction in gold, off-set buy the weakening sterling, sellers are still demanding £110-£150. If sterling continues to devalue and gold flies then I believe that would be a good alternative. If not, you shouldn’t lose your shirt, and you have some nice coins to give to your kids or grand children.

    Reply
    Please complete the required fields.



  • Jolo,
    we are talking about GDP not in absolute terms, but in terms of delta respect to the year before. India has a very high GDP, but most of people there live in poverty.
    In addition the problem here in UK is that people have debt. So people have + income – debt + assets. Ok assets are mainly houses and the value is collapsing. Income is at big risk because unemployment is growing. So you can be negative and have less than zero. That means that the Indian (wit all respect to him) in the middle of nowhere that owns zero is richer than you. Now you own know-how as well (education, information, etc..). If you have studied, you have skills that the Indian does not have you probably have a + in your balance sheet. Otherwise probably you will still have nice holidays for a bit, but not for long and for sure not your son!

    Reply
    Please complete the required fields.



  • I agree with you both denzil and Jolo

    Two things going on here:

    1. House Price Crash – Remember 11 million households with No mortgage so not all doom & Gloom – Those who took a punt on the housing market, anyhwere up to 5 or 6 years ago, or who have released equity (borrowed more) you may be stuffed.
    2. A recession – Not even really biting yet and as with point 1 many will be perfectly fine and some even make money – so spending isn’t just going to stop.

    So in brief – Housing f00ked, spending – a wee bit down.

    The trouble with VESTED INTERESTS is there are huge chunks of them in the media – “oh know, my property portfolio is stuffed, I must make some noise so the blubbermint helps us out” – Like politicians I think the media should tell us what vested interests they might be reporting on “This is Hugh Pym, for the BBC, with 6 houses and for apartments, reporting on the housing market”

    Reply
    Please complete the required fields.



  • now i can grasp why suliman paid so much for robinhio, and now ronaldo. as above , a little bit stuffed but just enough to keep the working class hero busy.
    you worry too much its gonna be allright.

    Reply
    Please complete the required fields.



  • @19… There are thousands of well-spoken Indians (graduates, post, masters, phd’s) in India.. Loads of call centres, loads of Brits (supposed web-designers) sponging off of the work of Indian Web Designers. We could always export our chav’s out there? So in short, they have so much potential and a more globally competitive wage. We really are quite uncompetitive in comparison, and job opportunities, well they are non existant. Graduates in the UK, are really not what they are made out to be, and this includes their attitude. If you speak to 100 employers, 70+% would say UK Grad’s couldn’t lick a stamp when it comes to work and attitude.

    Reply
    Please complete the required fields.



Add a comment

  • 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

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>