Bank of England base rate, predict what it will be in 2 years?

chucky

nearlynew wrote: »

When I was lad, houses were cheaper and more affordable, jobs more secure and mortgages more straight forward.
There was no thought about how you might be wrong-footed by some financial trickery several years down the line.

get over it - times change

nearlynew wrote: »

No one gave a f*ck about finding a long term tracker, or saving 0.25%, or tie-in periods, or redemption charges or whatever..............

More choice?

absolutely more choice and it's a good thing, if it saves money of course it's a good thing - those that don't understand them, will always be the ones that would complain.

_bankrupted

My estimate is no more than 2%.

It will be Spring early Summer next year when we start seeing interest rate rises. Probably increments of 0.25%. That's 6 increments until we hit 2%. An increment every 2 months and we'll hit that 2% base rate in Spring/Summer 2011. An increment every 2 months is pessimistic.

They are going to rise but not as sharply as they have fallen.

chucky

trackers are good - but only when the margins aren't in excess of 2% like they are now.

the most i'd want to pay on a tracker is anything up to 1.5% -2.44% is a still high i think

Generali

I have no idea what base rates will be in 2 years.

However, I think that if they start to rise then they may well rise quickly.

The Bank of England along with many other Central Banks have been increasing the monetary base (ie the stock of money). As retail banks haven't been lending the money out, we've not seen an increase in the money supply and so no inflation. If that extra 'cash' starts being lent out and so finds its way into the real economy, inflation would most likely start to rise quickly. As it takes a year - 18 months for increases in interest rates to choke off inflation, Central Banks would most likely look to increase rates rapidly for fear that inflation would get out of control.

chucky

Generali wrote: »

I have no idea what base rates will be in 2 years.

However, I think that if they start to rise then they may well rise quickly.

The Bank of England along with many other Central Banks have been increasing the monetary base (ie the stock of money). As retail banks haven't been lending the money out, we've not seen an increase in the money supply and so no inflation. If that extra 'cash' starts being lent out and so finds its way into the real economy, inflation would most likely start to rise quickly. As it takes a year - 18 months for increases in interest rates to choke off inflation, Central Banks would most likely look to increase rates rapidly for fear that inflation would get out of control.

to be on the safe side and agree with you say that anything beyond 2011 with regards to interest rates is very uncertain...

however it may not arrive until 2015 but it would be safe to say that asset price inflation will be returning at some point.

treliac

tommy75 wrote: »

I remember the MIG from a few years ago. That was a sneaky one.

We had one of those applied, by Britannia I think it was. Argued the toss and got it removed.

treliac

ess0two wrote: »

Get a lifetime tracker from say,ing or hsbc i think,then you can opt out without penalty should rates rocket.

Point is, won't fixed rates rise quickly at the same time .... making it difficult to get hold of a good fix by the time you realise you need it?

Generali

chucky wrote: »

to be on the safe side and agree with you say that anything beyond 2011 with regards to interest rates is very uncertain...

however it may not arrive until 2015 but it would be safe to say that asset price inflation will be returning at some point.

Well asset prices are already inflating (IMO due to very low interest rates making cash an unprofitable investment).

For me it's more about when goods prices start to rise. That's when Central Banks will act.

nembot

chucky wrote: »

get over it - times change


absolutely more choice and it's a good thing, if it saves money of course it's a good thing - those that don't understand them, will always be the ones that would complain.

Times didn't really change much till the decade of greed, which became so unsustainable, the BOE had to pump 200bn into the economy.

So yeah, times changed and it didn't work - correction here we come.

chucknorris

LizEstelle wrote: »

Wrong footed?

You were lucky.

I had to work down t' pit for 12 hours, come back home, make dinner for a family of 95 and then sleep under a cardboard box...

Cardboard box! Luxury! We used to dream of having our very own cardboard box, We lived in a hole in 'middle o road' and had to get up half an hour before we went to bed and pay for pleasure of working down mine.

Try telling that to the bears of today that and they won't believe you. But here's the proof:

http://www.youtube.com/watch?v=Xe1a1wHxTyo