Rate predictions 2022, 2023

Type_45

Lastonestanding said:

Type_45 said:

The interest rate probably should be around 7%.

I'm not saying I want that or they should do it. Quite the opposite. They should be printing money again.

Whether Truss gets in, an election around the corner often means a Government give away.

Such as higher interest rates?

coastline

ChilliBob said:

Was an amusing detour though!

According to the Independent, if Truss gets in some of her policies could result in 7% interest! - that feels like it would cause all kinds of problems for many people. As someone zero debt or credit cards and cash sitting in 1.5% odd accounts that would be most welcome.

I suspect if she came into power the policies would be watered down somewhat to raise rates, but not to anything near 7%!

Looking at the 10 year bond yields investors don't think we are going that far at all. It's taken 3 weeks to fall from 2.75% to under 2% which are levels seen in April. Focus appears to be shifting from inflation to the general economy and company earnings.

United Kingdom Government Bond 10Y - 2022 Data - 1980-2021 Historical - 2023 Forecast (tradingeconomics.com)

Took 40 years to peak and another 40 years to fall. 7% is years away .?

FYDN7BzVUAAsgbc (1200×503) (twimg.com)

Tax cuts will probably come in the form of corporation tax. Reverse the NI rise . Was it really going to pay for social care ? Maybe lift the personal allowance which really should rise every year anyway. Apart from that hope for the best.

Type_45

coastline said:

ChilliBob said:

Was an amusing detour though!

According to the Independent, if Truss gets in some of her policies could result in 7% interest! - that feels like it would cause all kinds of problems for many people. As someone zero debt or credit cards and cash sitting in 1.5% odd accounts that would be most welcome.

I suspect if she came into power the policies would be watered down somewhat to raise rates, but not to anything near 7%!

Looking at the 10 year bond yields investors don't think we are going that far at all. It's taken 3 weeks to fall from 2.75% to under 2% which are levels seen in April. Focus appears to be shifting from inflation to the general economy and company earnings.

United Kingdom Government Bond 10Y - 2022 Data - 1980-2021 Historical - 2023 Forecast (tradingeconomics.com)

Took 40 years to peak and another 40 years to fall. 7% is years away .?

FYDN7BzVUAAsgbc (1200×503) (twimg.com)

Tax cuts will probably come in the form of corporation tax. Reverse the NI rise . Was it really going to pay for social care ? Maybe lift the personal allowance which really should rise every year anyway. Apart from that hope for the best.

Yes, that's my understanding too - that the bond market is expecting rate cuts. And where the bond market leads, the Fed and BoE will follow.

So the dear old long-suffering poor savers will have to wait a while longer before wishing to throw the economy under the bus so they can make literally a few quid extra each month.

jimexbox

Gazprom are cutting Nord 1 to 20% capacity tomorrow. If Putin causes an energy crisis this winter, which looks increasingly likely. Tax cuts/rises will be the least of our concerns. 

ranciduk

The Fed raises by 0.75% 

Type_45

ranciduk said:

The Fed raises by 0.75% 

Will be the final hike before rate cuts, in my opinion.

Lastonestanding

ranciduk said:

The Fed raises by 0.75% 

Will that encourage the BoE to increase rates by more than .25 does Sterling going lower matter to the BoE?

Zerforax

Lastonestanding said:

ranciduk said:

The Fed raises by 0.75% 

Will that encourage the BoE to increase rates by more than .25 does Sterling going lower matter to the BoE?

There was a split at BoE last time over 0.25 or 0.5% so I can see a 0.5% increase happening this time..

Alistair31

Type_45 said:

ranciduk said:

The Fed raises by 0.75% 

Will be the final hike before rate cuts, in my opinion.

Federal Reserve Bank of Atlanta President Raphael Bostic said the US economy was “a ways” from entering a recession and the central bank had further to go in raising interest rates to get inflation under control.

Opinions, huh.

Ocelot

2022 - 1.75-2%
2023 - 1.5%