Are rates about to drop?

24ka

We are currently coming to the end of a 3 year deal and i am looking at switching to a 2 or 5 year deal.

We are with the Halifax at the moment and they have offered us a 2 year fixed deal of 4.99% - however i think i saw an article that said rates may drop over the next few weeks?

Has anyone else seen / heard this or is it just wishful thinking?

zag2me

The vested interests in the media say yes, the facts say no. But who knows, my crystal ball certainly doesnt.

rsykes2000

Unfortunately there are so many financial journalists that you can find an article that says anything you want it to read. For example, I saw one in one of the Sunday broadsheets (this Sunday just gone) that predicts it is unlikely rates will fall until at least March, possibly April. Basic answer is, no-one apart from the BoE 9 'wise men' really knows what they are going to do.

herbiesjp

rsykes2000 wrote:

Basic answer is, no-one apart from the BoE 9 'wise men' really knows what they are going to do.

Absolutely right.

However some lenders are in the process of REDUCING their fixed rate deals - what does this mean? It could mean that the lenders are already pricing in what they expect to be a drop in rates.

We'll just have to wait and see in Feb

meanmachine_2

Swap rates are down to around 4.10%, so yes, it does look like fixed rate deals will be coming down in expectation of a cut.

But it won't happen until March/April, if it does happen at all. And even then you'll get one cut, and that'll be your lot - based on *current* data.

If 0.25% either way is such a biggie for you, I suggest you've overborrowed.