BOE Interest Rate increased to 3%

mark_cycling00

Bit ironic how a few weeks ago Truss was viewed as reckless for "going for growth" and cutting taxes. 
Today Peston and the rest are saying Hunt is reckless for raising taxes and killing off growth and making 1,000,000 workers unemployed. The GBP-USD is almost back to where it was too.

So much captain hindsight going on lol

EssexHebridean

Coventry are on it - Regular Saver up to 3.15%. Fair play to them - they're the first I've heard from. 

Millyonare

mark_cycling00 said:

Bit ironic how a few weeks ago Truss was viewed as reckless for "going for growth" and cutting taxes. 
Today Peston and the rest are saying Hunt is reckless for raising taxes and killing off growth and making 1,000,000 workers unemployed. The GBP-USD is almost back to where it was too.

So much captain hindsight going on lol

As the old saying goes... be careful what you wish for.

[Deleted User]

hallmark said:

biscan25 said:

New government needed, independence of BoE needs to be revoked.

Totally agree to revoke the current MPC setup.  But there's no material difference between either party anymore when it comes to the economy.  High taxes, massive overspending, and endlessly expanding the state. Sunak is basically Gordon Brown.

If the BoE's independence was revoked then England would be even more of a Banana Republic with the current political conveyor belt of Muppets.

Targeted tax rises are needed along with low hanging fruit like abolishing non-dom status and a windfall tax on hydrocarbons. 

Millyonare

Deleted_User said:

hallmark said:

biscan25 said:

New government needed, independence of BoE needs to be revoked.

Totally agree to revoke the current MPC setup.  But there's no material difference between either party anymore when it comes to the economy.  High taxes, massive overspending, and endlessly expanding the state. Sunak is basically Gordon Brown.

If the BoE's independence was revoked then England would be even more of a Banana Republic with the current political conveyor belt of Muppets.

Targeted tax rises are needed along with low hanging fruit like abolishing non-dom status and a windfall tax on hydrocarbons. 

The BoE needs a change of culture, not a change of setup.

Tax rises are not necessary. The UK has just about the lowest state debt in the big global G7 club. The hysteria about UK debt is overblown and needless.

Adyinvestment

biscan25 said:

independence of BoE needs to be revoked.

What would be the alternative? Letting the government decide... I can't see that working out well with chancellors and PM's flip flopping all the time.

I am not a fan of central banks either, but whoever makes these decisions need to be making them for the good of the economy and not to try to win votes/power.

uk1

If the idea of increasing lending rates is to dampen demand on discretionary spending to retard inflation, then I am bewildered how this action works when the bulk of price rises effecting increases in expenditure is currently non-discretionary spending, ie heating, housing and food.  Almost all of the inflationary components are non-discretionary.  

In fact the obligation to spend more and more of fixed income on these essentials has already deflated discretionary spending and that reduction in loss of available discretionary spending will dig even deeper and hurt the wider economy likely accelerating recession.  So if the aim of increasing lending rates is to cause a more rapid recession then it is a great strategy. 

It is a weirdness that I have not yet heard questioned vigorously or heard explained or justified.  Or pehaps I simply do not understand things I thought I understood.

DannyCarey

We may batten down the hatches, hope our jobs are all safe and keep buying the indexes on the cheap for the next run of years until this all blows over. 

sharpe106

EssexHebridean said:

Coventry are on it - Regular Saver up to 3.15%. Fair play to them - they're the first I've heard from. 

True but they are still lower then what others were offering before the rate raise. 

Martico

uk1 said:

If the idea of increasing lending rates is to dampen demand on discretionary spending to retard inflation, then I am bewildered how this action works when the bulk of price rises effecting increases in expenditure is currently non-discretionary spending, ie heating, housing and food.  Almost all of the inflationary components are non-discretionary.  

In fact the obligation to spend more and more of fixed income on these essentials has already deflated discretionary spending and that reduction in loss of available discretionary spending will dig even deeper and hurt the wider economy likely accelerating recession.  So if the aim is to cause recession then it is a great strategy. 

It is a weirdness that I have not yet heard questioned vigorously or heard explained or justified.

All very true. I suspect that the impact on the pound given the US rate rises would have had a lot to do with this - greater imported inflation following further devaluation would be a big concern if the BoE weren't to try to keep pace with US rates in the current environment.