RPI projections

RobStaffs

Does anyone think inflation will drop below 3% in the next three years ? .I know if you had the answer you would be in the cabinet;) but I am thinking about putting a significant amount of cash away for three or five years in an RPI tracker..One of the things that is holding me back is whether there will be another release of NSI Indexed linked Certificates..

ses6jwg

I would hold back for IL Certs as the products currently avaliable are inferior IMO.

As long as the BoE and ECB continue to print money I cannot see inflation dropping signficantly any time soon.

RobStaffs

ses6jwg wrote: »

I would hold back for IL Certs as the products currently avaliable are inferior IMO.

As long as the BoE and ECB continue to print money I cannot see inflation dropping signficantly any time soon.

thanks.. My easy access account term runs out in Nov with the PO.There are some decent rates for this so I may hold back or even split it 50/50 between short term and long term.

DiggerUK

RobStaffs wrote: »

Does anyone think inflation .......I am thinking about putting a significant amount of cash away for three or five years in an RPI tracker.........

It is the Retail Price Index, and measures price inflation, not monetary inflation.
The price of gold is the barometer of 'real' inflation....which is monetary inflation, i.e., what the accepted worth of the money in your pocket is.
Monetary inflation leads to price inflation, but they are not one and the same.

As to NSI ILSC, wait until they come back and buy them. In the meantime, if you haven't used you Cash ISA allowance, park your savings there until they are back. As both are tax free it's no loss to you.
..._

lvader

DiggerUK wrote: »

The price of gold is the barometer of 'real' inflation..._

We must be in a heavy depression right now then.

ffacoffipawb

ses6jwg wrote: »

I would hold back for IL Certs as the products currently avaliable are inferior IMO.

Agree with this.

I have a 4.5% fixed rate bond maturing next March, hopefully there's be another NSI ILSC to invest it in from next April.

jimjames

I'm trying to work out the same thing but for different reasons. We are installing solar panels and the return depends on RPI as the feed in tariff is RPI linked. So high RPI in next few years will actually cut the payback time significantly and increase the overall return although obviously not so good for other things.

oldvicar

RobStaffs wrote: »

Does anyone think inflation will drop below 3% in the next three years ? .I know if you had the answer you would be in the cabinet;) but I am thinking about putting a significant amount of cash away for three or five years in an RPI tracker..One of the things that is holding me back is whether there will be another release of NSI Indexed linked Certificates..

I think it might, briefly, possibly early in 2012.

I agree with everyone else - keep some savings on easy access earmarked for the next issue of ILSCs.

I don't like the PO RPI accounts for reasons of: lack of access, safety, and tax treatment.

IronWolf

I wouldnt lock my money away for 5 years RPI linked but thats just me.

ffacoffipawb

IronWolf wrote: »

I wouldnt lock my money away for 5 years RPI linked but thats just me.

It's not locked in - that's the beauty of the NSI ILSC product.

ffacoffipawb

oldvicar wrote: »

I think it might, briefly, possibly early in 2012.

I agree with everyone else - keep some savings on easy access earmarked for the next issue of ILSCs.

I don't like the PO RPI accounts for reasons of: lack of access, safety, and tax treatment.

I wouldn't touch any Post Office product for the shameful way the parent company is treating holders of the Bristol and West PIBS who they took over in the 1990's.

I wouldn't trust a company like this at all.

See

http://www.fool.co.uk/news/investing/2011/06/10/bank-of-ireland-offers-pibs-holders-peanuts.aspx

http://www.fixedincomeinvestments.org.uk/home/bank-of-ireland-13-375-subordinated-bonds

http://www.protect-my-savings.co.uk/press-coverage/

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8571281/UK-pensioners-in-legal-revolt-over-Bank-of-Ireland-restructuring-terms.html