Bank of England unanimous on rate freeze

StiflersMom

It’s the first time that I have heard of the BOE members being in full agreement on both QE and interest rate rises.

Looks like low interest rates will be around for some point to come:
http://news.bbc.co.uk/2/hi/business/8317879.stm

Great news for us all

:j:j:j

Mr_Mumble

The markets have a very different viewpoint Stiflersmom. The lack of comment about QE in the September minutes is seen as a sign that the money printing will not be extended in November. This indicates earlier (relatively speaking, probably second-half 2010) interest rate hikes.

Pound hits one-month high as QE fears ease

The pound climbed to a one-month high against the dollar on Wednesday after the minutes of the Bank of England’s October monetary policy meeting struck a less dovish tone than expected.

As widely forecast, the minutes revealed that the nine-strong MPC voted unanimously to leave the size of its asset purchase scheme unchanged at £175bn earlier this month.

Analysts said the most important story within the release, however, was the fact that in the September minutes Mervyn King, the Bank’s governor, had thought an expansion of the central bank’s quantitative easing programme could be justified – but there was no mention of this in the October minutes.

“This perhaps suggests that the more positive macro news flow and the strength in asset prices may be moving the committee towards favouring a pause in quantitative easing at the November meeting,” said James Knightley at ING Financial Markets.

The pound rallied strongly on the news, climbing 1.1 per cent to $1.6565 against the dollar, its strongest level since September 17. It also rose 1.1 per cent to £0.9017 against the euro and gained 1.3 per cent to Y150.55 against the yen.

http://m.ft.com/cms/s/0/9a360846-be24-11de-9195-00144feab49a.html

Also Mervyn King in the Herald:

"I do not know for how long interest rates will remain so low. But at some point they will return to more normal levels and it would be wise to take this into account in your financial planning.”

http://www.heraldscotland.com/business/analysis/banks-casino-activities-must-be-curbed-1.927501

StiflersMom

Mr_Mumble wrote: »

... This indicates... probably second-half 2010 interest rate hikes.

Sage words indeed.

Good to see that even the bears are now conceding that base rate will not rise above 0.5% for about a year.

:T:T:T

As banks are introducing more great value low deposit products onto the markets, it will really take the sting out of any increase. This will really help all thouse that are buying.

Good luck to everyone

wynnvegas

Excellent. So long as interest rate's stay close to where they are, we'll have shunted the mortgage by the time they start rising. Who says recession is a bad thing!!??

abaxas

StiflersMom wrote: »

Sage words indeed.

Good to see that even the bears are now conceding that base rate will not rise above 0.5% for about a year.

:T:T:T

As banks are introducing more great value low deposit products onto the markets, it will really take the sting out of any increase. This will really help all thouse that are buying.

Good luck to everyone

Are you some kind of sicko? Why would you wish increased payments of people? Some 'luck' that.

StiflersMom

abaxas wrote: »

Are you some kind of sicko? Why would you wish increased payments of people? Some 'luck' that.

My point exactly - I am over the moon that everyone agrees that base rate is unlikely to rise for the next twelve months.

:T


As more and more products are coming onto the market, this is also leading to a much more competitive spread between base rate and mortgage rates, and this should cushion the blow from rising base rates when they come in 12 – 18 months time.

By which point the market will be up 10 – 15% in any case.

:j

As for being sick - I have been a little fluey recently, but am recovering well. Much like the housing market

ILW

StiflersMom wrote: »

By which point the market will be up 10 – 15% in any case.

:j

Probably true, but I cannot see what is good about it.

Davesnave

And for those with their house in cash, who are unsure which way things might go, there are 4%+ fixed interest deals out there which don't penalise too much if you change your mind half way through. It is still possible to win both ways.

doire_2

StiflersMom wrote: »

My point exactly - I am over the moon that everyone agrees that base rate is unlikely to rise for the next twelve months.

:T


As more and more products are coming onto the market, this is also leading to a much more competitive spread between base rate and mortgage rates, and this should cushion the blow from rising base rates when they come in 12 – 18 months time.

By which point the market will be up 10 – 15% in any case.

:j

As for being sick - I have been a little fluey recently, but am recovering well. Much like the housing market

Yeap the good times will be back again in 12 months :rolleyes: Doesn't matter about rising unemploymewnt, widespread government cuts

mystic_trev

StiflersMom wrote: »

Looks like low interest rates will be around for some point to come:

Really?

Oct. 21 (Bloomberg) -- The pound and the New Zealand dollar rose after central bankers signaled interest rates may increase.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aLz26bpPOx4E