Thursday, December 4, 2008
Surprise – more cuts.
Interest Rates Cut to 2%
The Bank of England has cut interest rates by one percentage point, from 3% to 2% - their lowest level in more than half a century. The move has been welcomed by many commentators who said the cut would help the slowing economy.
Posted by phdinbubbles @ 12:03 PM (1453 views)
12 thoughts on “Surprise – more cuts.”
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
jack c says:
Gordon Brown being interviewed (live) on Radio 5 Live for 1 hour with Simon Mayo this afternoon and taking questions from the public.
Another 1% cut as early as next month is now being forecast.
51ck-6-51x says:
It’s kind of surprising how BBC & Sky beat Reuters to publish this news.
In massive contrast to last time there was no noise from the rates traders, so no surprise punch pulled this time – 100bps just as the market expected.
Sweden cut by 1.75% earlier today.
mark wadsworth says:
That’s desperate throw of the dice number 14 so far, and the fifth this week (RBS 6 months, NR 6 months, taxpayer funded two years interest, declaring HBOS collar unenforceable were the others)
jack c says:
@mark wadsworth – they are looking at another desperate throw of the dice next month with further 1% reduction already being widely forcast.
whostolemyendowment says:
Cuts on the back of previous cuts that in themselves haven’t had their full affect felt yet….and there goes my savings rate! Sh1t – I might aswell draw out all my cash and buy stuff while I still can……or is that their fiendish plan all along?
landofconfusion says:
I was just reading Bloomberg when I saw this:
“Such steps may include expanding money supply and using it to finance government deficits or buying securities such as bonds or stocks, he said. ”
(my emphasis).
Why haven they already done this yet? They obviously don’t care about the pound being devalued and know that this cut won’t be anywhere near enough, so why wait?
mark wadsworth says:
@ Jack C, next month? These attempts are now coming thick and fast. My money’s on Council Tax exemptions for people with mortgage-to-income ratio above a certain level.
jack c says:
@mark wadsworth – agreed, they are effectively looking at the mother of all bail-outs – I’ll post up any worthwhile snippets following Crash Gordon’s interview which starts at 1.00pm
Ketha says:
It might be a roll of the dice but doing nothing is a far riskier option as Japan has proven.
51ck-6-51x says:
landofconfusion: “why wait” – I don’t have an answer to your intelligent question, but I will point out this: The thing about devaluing your currency is that if you are directly doing it – i.e. you are making a decision to devalue, then it’s far, far better to do all of your work in one go and let the markets know that (so slightly over devalue) – doing a little bit now and then a bit later on is the worst solution – you let the markets know what you are doing and that acts against your currency forcing more devaluation next time. So I think it may imply that they do not know how much to go for yet; they maybe waiting for more information on the state of other currencies.
landofconfusion says:
51ck-6-51x, thanks for your reply. I have to admin that I’m beginning to think that the MPC doesn’t have a clue. The interest rate stick is obviously broken and the only way is down.
What really annoys me though is that they’re quite willing to take us savers down with them. Maybe I should just move my money into Euros and gold and to hell with it.
51ck-6-51x says:
landofconfusion: sure I’ve thought about moving to other currency denominated accounts (about £5 a month through HSBC I think), but I think that the gold market is too manipulated, and the chances are that the powers that be will come and prize the gold out of your hands when it becomes useful (or maybe just ban gold ownership & sales as has happened before).