Interest rates could rise sharply next year

Graham_Devon

Suppose we'd at least start to see how strong (or weak) the recovery is.

Interest rates are expected to rise sharply next year, experts have predicted, as official figures heralded the end of the squeeze on wages.

A Treasury survey of City economists found that all now expected rates to rise, with some predicting them to more than triple to 1.75 per cent.

Higher rates could provide respite to millions of pensioners who have seen the value of their savings shrink due to the impact of inflation and rock-bottom returns. However, it will leave many families paying significantly more on mortgages and debt repayments.

David Cameron said that hundreds of thousands of people have been given the “hope of a brighter future” after official figures showed wages are going up faster than prices.

http://www.telegraph.co.uk/finance/personalfinance/interest-rates/10771342/Interest-rates-to-rise-sharply-next-year-as-wages-grow.html

chucky

Graham_Devon wrote: »

Suppose we'd at least start to see how strong (or weak) the recovery is.


http://www.telegraph.co.uk/finance/personalfinance/interest-rates/10771342/Interest-rates-to-rise-sharply-next-year-as-wages-grow.html

What about inflation or even deflation?

Graham_Devon

chucky wrote: »

What about inflation or even deflation?

Interesting isn't it.

We could be putting our rates up at a time that the EU is playing around with QE.

chucky

Graham_Devon wrote: »

We could be putting our rates up at a time that the EU is playing around with QE.

Will we?? Are you guaranteeing it?

"Rates rising to 1.75%, well below the average base rate" doesn't have the same appeal or headline grabbing attention does it.

Not sure how it helps pensioners either.

purch

These "experts" appear to be insane.

If the base rate were to rise to 1 3/4%, the chances of Pensioners getting significantly more return on cash savings are slim to non existant.

There is even more drivel written in the so called quality press, than there even is on this forum.

Generali

If the BoE raises rates in the face of Eurozone QE then we'll get a pretty graphic demonstration of what happens when the FX rate rises very quickly.

PaulF81

chucky wrote: »

Will we?? Are you guaranteeing it?

"Rates rising to 1.75%, well below the average base rate" doesn't have the same appeal or headline grabbing attention does it.

Not sure how it helps pensioners either.

or exporters. not so sure 2 dollars to the pound or €1.50 to the pound is supposed to help our export led recovery.

Generali

PaulF81 wrote: »

or exporters. not so sure 2 dollars to the pound or €1.50 to the pound is supposed to help our export led recovery.

I'm not sure why you'd want an export led recovery. It means that people are so badly paid that they can't afford to buy the things that they produce.

Germany exports loads and has no minimum wage in exporting sectors of the economy. Hmm.:think:

michaels

I'll think you'll find it isn't that they can't consume but that because they all live in very cheap rented accommodation with security of tenure they all decide to save all their money instead....

purch

GBP will appreciate without any changes in Interest rates, if our economy is growing/recovering faster than our competitors.

An interest rate rise is more likely to choke off any recovery, thus ultimately leading to GBP weakening

Blacklight

Yeah they could... might not though. 1.75%, no-one cares about your scaremongering anymore Devon *yawn*