BoE Interest Rate Up/Down/No change

purch

If the MPC weren't looking at both as possible then they'd be incompetent.

Yes, and they must and will do so.

But at the moment (January 2011) I feel a clearer message needs to be sent.

Really2

Graham_Devon wrote: »

So again, what is your solution?

Leave it? I'm only passing on what others are saying outside of this forum. Other economists. They seem to think differently to many on here. However, I still think many on here have the mortgage costs at the back of their minds.

I mean to say next to Greece, when I said next to Germany, so apologies for that error.

Honestly GD my mortgage cost is irrelevent in my debate as 0.5% to 1% means nothing to me. Having a job is far more important.

I really do think their is no solution at the moment, the only thing you could do to get an instant fall is revert VAT.

I think it really is a "suck it and see" for the next 12 months. That is not to say I don't think the BOE might do something.

But in reality Inflation is going to be over target all year, no amount of rate increases are really going to change that more than breifly.

The real problem is going to be the sqeezed GDP, raise rates you increase the preasure of the TAX increases and result in even less public spending.

It really is a rock and a hard place as it is the TAX forcing the preasure on the BOE.
Leave it as it is People lose money in real terms, increase it people lose money in real terms and it could effect the recovery.

Leaving it is the lesser of two evils IMHO until Tax rises are out of the system, unless we see it getting very wayward (4%)

Don't forget increasing the Base rate will increase RPI, anyone think that will increase their wages, public sector have a two year freeze?

It's a choice of how poor you want to make people feel at the moment, glad it is not my job.

I personaly do not understand why when there is a VAT rise why they do not raise the target for the following 12 months. (like wise on drops).

Generali

purch wrote: »

Yes, and they must and will do so.

But at the moment (January 2011) I feel a clearer message needs to be sent.

I see your point, the thing is for me is that they disagree and they are meant to be independent and so are allowed to disagree.

whatyadoinsucka

its good to see some well thought out arguments for once on this board, just when i thought self interests were taking over the boards

No change from me, although we may get a 'just for show' rise later in the year..

I'm just getting fed up with all the propaganda, i feel the banks have had it good for far too long and deserve to have people stick to lower SVRs rather than pay for the bonuses that any fixed rate mortgage will currently do,

Really2

Graham_Devon wrote: »

Other economists. They seem to think differently to many on here. However, I still think many on here have the mortgage costs at the back of their minds.

Sorry should add

Do many other economists think much different to what has been talked about today, I thought the majority still see the TAX rises as the main issue and acknowlage that we are getting some inflation but it's a hard balance.

In reality if I was thinking of my mortgage (or any other) I should be wanting inflation and wages getting pushed up. Net Debt errosion would be a life line for many, but I really do not think it is a correct route or a controllable route.

I am happy to try to get paid back rather than inflating it away, inflating it away could be hard to reign in.

IveSeenTheLight

Who really thinkgs the rates will go up 0.5%?
I'd be interested to understand their thinking behind that.

With the economy as it is, the first movement has to be 0.25% to change the mindest for further rises.
0.5% first change could make some people panic

Generali

The 36 were right. No change, no surprise.

IveSeenTheLight

Generali wrote: »

The 36 were right. No change, no surprise.

Looks like an additional three wanted to add their views after the announcement to ensure they were right
No surprise, no change