Thursday, June 17, 2010

IRs

King Says BOE Will Probably Start Stimulus Exit by Raising Rate

"Mervyn King said officials will probably raise interest rates before selling bonds when they decide to remove stimulus in the economy, which is still struggling to shake off the effects of the recession". The Monetary Policy Committee “will not hesitate to begin to withdraw the current degree of stimulus when we judge that is necessary,” King said yesterday in London. “That is most likely to be through a rise in bank rate with asset sales being conducted later in an orderly program over a period of time, leaving bank rate as the active instrument.”

Posted by alan @ 08:09 AM (3568 views)
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2 thoughts on “IRs

  • Bang on queue, talk of raising rates at the precise equinox from a rate decision two weeks ago (which was to keep rates at zero). When decision time comes around again in two weeks, the decision will be to hold yet again and this pronouncement will be forgotten like last week’s news.

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  • I’m doubtful that we’ll see a rate increase from the next MPC meeting, but I would not be surprised if the minutes contain a broad hint of one to come soon..

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