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Bank of england maintains bank rate at 0.5 pct
inspector_monkfish
Posts: 9,276 Forumite
12:00 10Mar11 - BANK OF ENGLAND MAINTAINS BANK RATE AT 0.5 PCT
12:00 10Mar11 - Bank of England holds rates steady as expected
LONDON, March 10 - The Bank of England kept interest rates at a record low of 0.5 percent on Thursday, judging that Britain's economic recovery remains too weak to sustain an inflationary spiral.
Inflation has already surged to 4 percent, twice the central bank's target, but the economy faces headwinds from public spending cuts and suffered a surprise contraction at the end of last year.
Some BoE policymakers have indicated that they want to see how Britain's economy performs in the first quarter before changing policy.
All but one of the 63 economists polled by Reuters had predicted a steady verdict. However, most expect the central bank to raise rates before the end of the year and investors are betting on a rise in May.
The European Central Bank, dealing with a much smaller inflation problem, has already signalled that an interest rate rise is imminent.
UK interest rates have stood at 0.5 percent since March 2009 when the BoE slashed rates to an all-time low and embarked on an unprecedented programme of quantitative easing.
12:00 10Mar11 - Bank of England holds rates steady as expected
LONDON, March 10 - The Bank of England kept interest rates at a record low of 0.5 percent on Thursday, judging that Britain's economic recovery remains too weak to sustain an inflationary spiral.
Inflation has already surged to 4 percent, twice the central bank's target, but the economy faces headwinds from public spending cuts and suffered a surprise contraction at the end of last year.
Some BoE policymakers have indicated that they want to see how Britain's economy performs in the first quarter before changing policy.
All but one of the 63 economists polled by Reuters had predicted a steady verdict. However, most expect the central bank to raise rates before the end of the year and investors are betting on a rise in May.
The European Central Bank, dealing with a much smaller inflation problem, has already signalled that an interest rate rise is imminent.
UK interest rates have stood at 0.5 percent since March 2009 when the BoE slashed rates to an all-time low and embarked on an unprecedented programme of quantitative easing.
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Comments
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No surprise then0
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Some BoE policymakers have indicated that they want to see how Britain's economy performs in the first quarter before changing policy.
They'll be doing that in Q2 too. And Q3....Q4.
Meanwhile, inflation keeps on rolling.0 -
What happened to the "Fix now - we're all doomed" guys from three years back ?
Where are they ?Space available for rent0 -
Graham_Devon wrote: »
Meanwhile, inflation keeps on rolling.
I could'nt care less if the price of bread has gone up 50p, my mortgage is only £139 a month!
Long may it continue.0 -
Graham_Devon wrote: »Meanwhile, inflation keeps on rolling.
Inflation does not matter, short term......................................................................................
the sooner the moaners come to understand this the better !0 -
whatyadoinsucka wrote: »Inflation does not matter, short term......................................................................................
the sooner the moaners come to understand this the better !
With a potential 3.5% degrade in living standards a year.
Yes it does as the differential between debt, wage increases and inflation means relative to the wages, people's debt is actually getting larger.0 -
With a potential 3.5% degrade in living standards a year.
Yes it does as the differential between debt, wage increases and inflation means relative to the wages, people's debt is actually getting larger.
you must have been taught a different economics/finance to me..
Inflation means the cost of money loses value so a mortgage today of £100k is worth far less in the future due to inflation..
same as a £10 yesterday may buy you 2 cinema tickets and a popcorn on orange wednesday tomorrow you may only get one ticket and popcorn for a £100 -
ANY rise in wages will make debt easier to pay off if that debt remains constant, however if the debt also increases faster due to higher rates....0
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whatyadoinsucka wrote: »you must have been taught a different economics/finance to me..
Inflation means the cost of money loses value so a mortgage today of £100k is worth far less in the future due to inflation..
same as a £10 yesterday may buy you 2 cinema tickets and a popcorn on orange wednesday tomorrow you may only get one ticket and popcorn for a £10
What I'm saying is the debt stays the same but relative your disposable income in increases.
Ie you are paying the same but the get less for your disposable income. Ie the debt becomes harder to service if you with to maintain your lifestyle.
The debt is decreasing in terms of it's headline figure, but is actually increasing in terms of it's valuation.0 -
What I'm saying is the debt stays the same but relative your disposable income in increases.
Ie you are paying the same but the get less for your disposable income. Ie the debt becomes harder to service if you with to maintain your lifestyle.
The debt is decreasing in terms of it's headline figure, but is actually increasing in terms of it's valuation.
Disagreed depending on your career choice your income should go up over time.. i know i do not plan to stay on my current salary long term, and i could easily squeeze another 10-20% by moving jobs.0
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