Interest rates to rise again

Alan_M_2

Hereward wrote:

Shouldn't that be House Price Crash 7: I though we wanted to rename The 18 Year Cycle as House Price Crash 6.

OOOH, did I miss one? :rotfl:

sanfrancisco

We will see 6% next year.

China are now exporting inflation, and this has been one of the biggest influences on the ridiculous CPI basket in the last few years. Hang on though, they could start removing the ipods and dvd players to avoid this "problem", leaving um, um ?? Anyone?

CB1979_2

sanfrancisco wrote:

We will see 6% next year.

China are now exporting inflation, and this has been one of the biggest influences on the ridiculous CPI basket in the last few years. Hang on though, they could start removing the ipods and dvd players to avoid this "problem", leaving um, um ?? Anyone?

any chance of Saturday's lotto numbers as well while you're there?

sm9ai

sanfrancisco wrote:

We will see 6% next year.

China are now exporting inflation, and this has been one of the biggest influences on the ridiculous CPI basket in the last few years. Hang on though, they could start removing the ipods and dvd players to avoid this "problem", leaving um, um ?? Anyone?

The sad thing is they will probably fix it. They will remove DVD players and replace them with BlueRay which will come down in price for the next 5 years or so.

talksalot81

What gives such confidence in IR rises? Many believe this is what we should do to try and save us, but Gordon Brown tend to monitor public view and do the opposite.

Dont get me wrong, I would love to see a significant rise, but I cant be confident it will occur.

benood

Sorry folks I don't see rates rising above 5%, the MPC want to control inflation, house prices are peripheral. The current rate of inflation is expected, it will start to come down next year quite possibly negating any requirement for further increases. In sterling terms oil prices are right off their peaks pushing down general inflation over the next few months.

asandwhen

There was talk that this inflation report wuld be 2.9% so I think the BOE would be releaved to see it at 2.7% - shops are already starting to slash there prices due to a slow christmas and oil prices well down on there highs I think inflation should start to curb next year - also the latest 2 interest rises would not have had any effect on inflation yet I think it takes about a year or so to make an impact so we are seeing the interest cut of last year having an effect on inflation.

My view is that we will have a .25% rise early next year then back to 5% by this time next year.

talksalot81

benood wrote:

Sorry folks I don't see rates rising above 5%, the MPC want to control inflation, house prices are peripheral. The current rate of inflation is expected, it will start to come down next year quite possibly negating any requirement for further increases. In sterling terms oil prices are right off their peaks pushing down general inflation over the next few months.

I tend to see it this way too... but the house price question cannot remain forgotten forever. The longer it is left, the worse the situation gets... surely, eventually, the powers the be must try and control this aspect of our country's finances!?

BobProperty

talksalot81 wrote:

I tend to see it this way too... but the house price question cannot remain forgotten forever. The longer it is left, the worse the situation gets... surely, eventually, the powers the be must try and control this aspect of our country's finances!?

I can't remember a time when they've tried very hard. I also think they couldn't control it even if they wanted to.

Gorgeous_George

BobProperty wrote:

I can't remember a time when they've tried very hard. I also think they couldn't control it even if they wanted to.

They could do so very easily. Increase interest rates when prices start to rise and decrease them when prices fall. Alternatively, increasing income tax would be even more effective.

Why they would wish to keep house prices under control is the big question. They charge VAT on solicitor's and Estate Agent's fees, stamp duty on houses and, of course, the feel good factor encourages people to spend.



GG-