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MSE News: Unemployment drops sharply – so are interest rates set to rise?
Former_MSE_Helen
Posts: 2,382 Forumite
"Unemployment has fallen to 7.1% – close to the figure which will be used to decide whether interest rates rise..."
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Unemployment drops sharply – so are interest rates set to rise?
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Unemployment drops sharply – so are interest rates set to rise?
Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.
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Hopefully, but as so many of these so called jobs are zero contracts, temporary, shuffling of registers etc., I can't see the Bank of England doing much about interest rates.
Lin
You can tell a lot about a woman by her hands..........for instance, if they are placed around your throat, she's probably slightly upset.
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I thought the 7% level was just a gate to rate rises and not a trigger?? Just because we reach that level doesn't mean all the other gates have been opened...0
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What sort of jobs are they?
The devil's in the detail.Posts are not advice and must not be relied upon.0 -
Some City analysts today think we will have a rise by the end of the year perhaps, and for me it would be good, as regards savings etc., but i suppose we will have to wait and see.
Lin You can tell a lot about a woman by her hands..........for instance, if they are placed around your throat, she's probably slightly upset.0 -
The normal determinant of interest rates is using them to control inflation. The 7% unemployment figure was set as a point when it would be deemed acceptable to start using increased interest rates to force down inflation which had been above target. However as inflation is currently within target, the 7% unemployment figure becomes less relevant because its secondary to the real decision factor - inflation.Adventure before Dementia!0
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What sort of jobs are they?
The devil's in the detail.
Ah well, that's the problem - registers are shuffled and although it appears more work is there, the benefit bill keeps rising, which suggests there are just as many claimants, but some of those have been moved, for various reasons, onto other lists.
Lin You can tell a lot about a woman by her hands..........for instance, if they are placed around your throat, she's probably slightly upset.0 -
You'd want a sustained drop in unemployment into genuine jobs before you put up interest rates. Bearing in mind wages have hardly risen and the cost of living has risen a lot I think it would be foolish to pressurise a lot of working people further until wages have started to recover more.0
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I thought Mark Carney said last August "that the Bank would not consider raising interest rates until the unemployment rate has fallen to 7% or below." (with some caveats)
I don't remember any suggestion that rates will definitely rise once unemployment falls to 7%. But certainly that particular restriction put in place to provide financial stability at that time would no longer apply once the unemployment rate falls to 7% or less.0 -
Carney, hand picked by George Osborne, will just move the goalposts to ensure that nothing happens to interest rates this side of the general election.0
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NPowerUser wrote: »Carney, hand picked by George Osborne, will just move the goalposts to ensure that nothing happens to interest rates this side of the general election.
I suspect you are correct on this, which begs the question about BOE independence?0
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