Next BofE base rate move

Gorgeous_George

July 2008 and the BofE held base rates at 5%.

Which way will rates change and when?

I think down in August, October and December finishing at 3.5% THIS year.



GG

lynzpower

I hope they hold at least till the end of the year TBH.

If they went down to 3.5 I can see the demand for mortgages ( and remortgages and securing debts) being astromonical. Hell even Id think of getting one.!

What will this do to the liquidity in the system? Probably not a lot, as its libor that is the cost of borrowing not the base rate.

I hope they hold. This low interest economy- encouraging overborrowing has stuffed GB PLC royally.

HammersFan

It seems to be very dependent on where oil is heading. I would have thought 4.5% at the end of year since members of the MPC hint that 5% is restrictive. Although I think GG's 3.5% could well be the case into next year.

ManAtHome

The BoE can probably do what they like (or what troosers tells them) to little effect - the proper banks have been setting rates for the last 6 months or so. Anyway, why should they need to drop rates when we apparently have a "stable economy, well-placed to ride out the storms caused by the rest of the world"..?

mr.broderick

Gorgeous_George wrote: »

July 2008 and the BofE held base rates at 5%.

Which way will rates change and when?

I think down in August, October and December finishing at 3.5% THIS year.



GG

I don't see 3.5 by end of year gg.
Think they'll hover around 5% for the foreseeable then creep up early next year, just imho.

lostinrates

Whatever I guess, the opposite happens.

I do think that they will stay stable - not what i think should happen, but what I think will happen. I agree with the poster in the other thread who said it would take a brave person to change them.

NikkiP_2

inteerst rates aren't stable at the moment.
base rate is stable but that is now really irrelevant.
The rate that matters is Libor ( london Inter Bank Offer rate). This is the rate that banks borrow money at and have to add a margin and then lend it out.
1 month libor is around 5.5% and 3 month libor is 5.9%.
I cant see rates coming down in the near future, I expect that base rate will rise later this year and by mid next year be about 6% wher libor is now.
Shouldnt have an impact on mortgages as they will already have a libor link.

beecher

Hold til the end of the year I think - can't see them making a decision either way at the moment. Then I'm unsure what way they'll go - thought they'd go upwards but am unsure what difference this will make really so they may go for sentiment and have a move downwards.

posh*spice

Gorgeous_George wrote: »

July 2008 and the BofE held base rates at 5%.

Which way will rates change and when?

I think down in August, October and December finishing at 3.5% THIS year.



GG

Nooooo! steady all year - high possibility of a quarter drop by year end;)

Posh

Pobby

Well as long as they fart around with the inflation figures I guess they can blindly keep to around 5%. Just hope that Morrisons keep up ther bogoffs and there is a huge demnad for £18 dvd players to base there calculations on. If the boe, imho, put the rates where they should be, millions will be in deep trouble.

michaels

I think the libor discussion is very pertinent - 5% base rate now is much more restrictive than when the libor spread was much lower which makes it hard to say what real rates are at the moment. I guess what happens to wages is the key issue - if the weakening job market keeps pay rises down then I think rates won't rise further but I'm not sure - no wonder the govt was trying to get all the public sector to agree long term deals. I thought it was to avoid pay disputes prior to a potential election next year but it looks like they knew something we didn't re inflation...