MSE News: Interest rates could hit 8%, says economist

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This is the discussion thread for the following MSE News Story:

"Interest rates could rise to 8% by 2012 if inflation gets out of control, a think tank has warned ..."

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  • poppy10_2
    poppy10_2 Posts: 6,575 Forumite
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    Forget 8%, I reckon we're going to return to the heady days of 15%+ rates in the next few years. There's no precedent for the all-time record low interest rates and wanton printing of billions of pounds currently taking place - it is propping up the economy for now, but once people realize it is just monopoly money and lose faith in the currency, 10% inflation will seem tame.
    poppy10
  • dunstonh
    dunstonh Posts: 116,598 Forumite
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    I refer you to Guy's other post saying interest rates are going to remain low until 2014.

    What is it going to be?
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • Mr_Forgetful
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    I agree. It seems to change every week as to how long the rates will stay low. I would say that no-one has any idea but we all ought to be prepared for if and when they do revert back or go higher.
    I'm sure I went upstairs for some reason.
  • Sceptic001
    Sceptic001 Posts: 1,111 Forumite
    edited 23 August 2010 at 2:11PM
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    dunstonh wrote: »
    I refer you to Guy's other post saying interest rates are going to remain low until 2014.

    What is it going to be?
    Somewhere between the two? (probably!)
    [STRIKE](By the way, is it 8% or 10%? Headline says 8%. Text says 10%)[/STRIKE]
  • Joe_Bloggs
    Joe_Bloggs Posts: 4,535 Forumite
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    I think you can read what the original author thought for a tenner. I feel sorry for the press association that they thought it newsworthy enough to create a summary of it. I am sure that the Policy Exchange are laughing all the way to the bank for the free publicity.
    If you subscribe to news then you will get news even when there is no news.
    J_B.
  • JimmyTheWig
    JimmyTheWig Posts: 12,199 Forumite
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    dunstonh wrote: »
    I refer you to Guy's other post saying interest rates are going to remain low until 2014.

    What is it going to be?
    I don't think that _Guy_ is saying either. Merely reporting what others have said...
  • GMS
    GMS Posts: 5,388 Forumite
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    'Could' hit 8% 'if' this and that.

    If you cros the road at 11.43 am you 'could' be hit by the 21a bus 'if' the bus is on time.

    Different day, different opinion of what is happening with interest rates.

    Basics are; Rates are at an unprecedented low, in an unprecedented economic situation, and WILL rise. Only questions are when, and to what level.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • astralbee
    astralbee Posts: 107 Forumite
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    I've been reading all the comments to this headline on various news sites this morning and so many people seem to enjoy being smug about the possibility of crippling rises. True, there are some who have greedily remortgaged their properties thanks to the falsely inflated house price rises and then wasted it; but the fact is that millions of families will really struggle to pay reasonably sized mortgages if the interest rates get that high.

    Three years ago I bought a very modest 3 bedroom semi to start a family (which we now have) and my mortgage of £79K represents less than two thirds the value of my house because I had saved and was able to make a deposit. I am an avid 'money saver' that has hammered down all my bills as per the advice on this site. Yet despite all this frugality and sensible use of my money I am still facing difficult times if the interest rate really does rise to 8%!
  • poppy10_2
    poppy10_2 Posts: 6,575 Forumite
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    Sceptic001 wrote: »
    (By the way, is it 8% or 10%? Headline says 8%. Text says 10%)
    Nope, it says 8% interest rates in headline and in the text. The 10% was referring to the inflation rate
    poppy10
  • dunstonh
    dunstonh Posts: 116,598 Forumite
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    I don't think that _Guy_ is saying either. Merely reporting what others have said...

    True.

    However, the other thread was full of comments saying that use of the MSE NEWS tag when its just an opinion of one individual or think tank is not right. Its not news. Its opinion and if MSE are going to repeat it then don't repeat it as if it is going to happen. Semantics I know but we also know how many posters react to MSE articles and posts and believe them to be gospel. (remember the Icelandic banks)

    Also, notice how the "opinion" on low interest rates was posted only in the savings and investments forum but the "opinion" on high interest rates was posted in the mortgage one. Scaremongering perhaps? focusing on the ones that would be worse off in each case.

    As I have said before and others have said on this thread and the other, there is nothing wrong with reporting opinions but the truth is that no-one has a clue and the site should avoid joining in rumour, scaremongering and hype but remain focused on fact and moneysaving. If it wants to post rumours and hype then at least do so under a different title and not NEWS.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
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