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Base rate could be at 0.5% untill the end of 2011
Really2
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http://www.forbes.com/feeds/afx/2009/08/12/afx6769474.html
Interest rates are likely to remain lower for longer than the markets expect. Even assuming Bank Rate at 0.5 percent until the end of 2011, the bank expects inflation to undershoot the target rate until the final quarter of 2011 (again, excluding the VAT spike).
Looks like we are going to be doing a long payback rather than high inflation to "downsize" the debt.
It will be interesting to see what this does. Good and bad, debt will remain fairly cheap to service but this also indicates low/negative inflation. This will mean wages will remain fairly static at best.
Interest rates are likely to remain lower for longer than the markets expect. Even assuming Bank Rate at 0.5 percent until the end of 2011, the bank expects inflation to undershoot the target rate until the final quarter of 2011 (again, excluding the VAT spike).
Looks like we are going to be doing a long payback rather than high inflation to "downsize" the debt.
It will be interesting to see what this does. Good and bad, debt will remain fairly cheap to service but this also indicates low/negative inflation. This will mean wages will remain fairly static at best.
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Shame it's not possible.
As for fixed rate mortgages surely if rates are too high then people will opt for trackers but I can't see the fixed rates dropping too far (maybe to 3%?)
Start balance: £205,746.51 :eek: Month 18/100..paid 13.50%
Current balance: £177,977.07 (updated 18.12.10)
Target 12.12.12: From £194,000 to £140,000:p
MFI-3 reductions: £16,023/£54,000 achieved (29.67%):j
I can't see any rates coming down until they are happy they have rebuilt their balance sheets sufficiently.
Cost of retail deposits is still rising........
Savers are fighting back.
Only those on lifetime trackers. For others it means a new mortgage deal.
One here
Wondering if it is more a case of customers being fought for by these institutions?