Are we expecting BOE to remain at 4.75% on 8th February 2025?

middleagedriver

Interesting summary from Faisal Islam on the BBC. Looks like the tone has very much changed and a cut will happen in August. See how the markets react

ReadySteadyPop

middleagedriver said:

Interesting summary from Faisal Islam on the BBC. Looks like the tone has very much changed and a cut will happen in August. See how the markets react

No change there, the tone from the media since the rate hikes started has been "They will cut............sometime in the future.........maybe" . Really bad news for house sellers this one.

naf123

ReadySteadyPop said:

Looks like it was 7 for a hold and 2 to cut so I was far wrong, they seem to be in a holding mood as RS said, surely loads of people are going to put their house buying plans on hold now?

I don't think so. Housebuying/ selling etc has not changed much in the last 3 years. 5.25% rates is historically low/average. Wages are going up. For a £200K mortgage , from 2% to 5% is maybe £300 difference per month. If wages go up £3k on average, the problem is solved. 

ReadySteadyPop

naf123 said:

ReadySteadyPop said:

Looks like it was 7 for a hold and 2 to cut so I was far wrong, they seem to be in a holding mood as RS said, surely loads of people are going to put their house buying plans on hold now?

I don't think so. Housebuying/ selling etc has not changed much in the last 3 years. 5.25% rates is historically low/average. Wages are going up. For a £200K mortgage , from 2% to 5% is maybe £300 difference per month. If wages go up £3k on average, the problem is solved. 

Looks like they won`t need to cut rates then, good news as I am enjoying the income.

RelievedSheff

ReadySteadyPop said:

naf123 said:

ReadySteadyPop said:

Looks like it was 7 for a hold and 2 to cut so I was far wrong, they seem to be in a holding mood as RS said, surely loads of people are going to put their house buying plans on hold now?

I don't think so. Housebuying/ selling etc has not changed much in the last 3 years. 5.25% rates is historically low/average. Wages are going up. For a £200K mortgage , from 2% to 5% is maybe £300 difference per month. If wages go up £3k on average, the problem is solved. 

Looks like they won`t need to cut rates then, good news as I am enjoying the income.

I don't believe they will cut rates in August.

Perhaps a small token gesture 0.25% cut in September before a long stint at 5%

RelievedSheff

ReadySteadyPop said:

Looks like it was 7 for a hold and 2 to cut so I was far wrong, they seem to be in a holding mood as RS said, surely loads of people are going to put their house buying plans on hold now?

I doubt many, if any, people base their house buying decisions on the bank of England base rate!

ReadySteadyPop

RelievedSheff said:

ReadySteadyPop said:

Looks like it was 7 for a hold and 2 to cut so I was far wrong, they seem to be in a holding mood as RS said, surely loads of people are going to put their house buying plans on hold now?

I doubt many, if any, people base their house buying decisions on the bank of England base rate!

Well no, it is based on the "10 Year Yield" and how much their lender says they can borrow for a lot of people.

lojo1000

RelievedSheff said:

ReadySteadyPop said:

Looks like it was 7 for a hold and 2 to cut so I was far wrong, they seem to be in a holding mood as RS said, surely loads of people are going to put their house buying plans on hold now?

I doubt many, if any, people base their house buying decisions on the bank of England base rate!

Most people want to get on the "housing ladder" mecca to show they actually are worth the life they are living. The decision to buy is already made by most people once they've adsorbed enough of the Daily Express, et al and listened to economic journeymen on how life is all about marriage, 2 kids and a mortgage.

The question before making the decision is so often "how much can we borrow" not "isn't this amount of indebted leverage a financial risk?"

Once they're in up to their necks, they can get back to takeaway coffee, scrolling the internet and seeking solace in knowing everyone else is in the same position.

BoE will cut if inflation moves below 2% later this year because they pander to their ego which is hurt by too many thoughtless questions focused on the immediate near term GDP release as opposed to how debt is strangling ingenuity and productivity.

lojo1000

Will rates come down in August?
Where is inflation going?

Strong retail sales today, see below. No hint here of a struggling economy.



And the next 3 months of MoM inflation figures to fall out of the annual figures (Jun-Aug) are clearly below the last 3 month figures. This suggests that unless monthly inflation falls markedly, unlikely given a strong consumer, then inflation will actually start moving up again over the coming months.

Both core and headline show the same weak inflation figures dropping out relative to the new, higher monthly readings.

BikingBud

Strikes me as continually bizarre and grossly inappropriate to try and control interest rates based upon a scale that doesn't even include house prices. All in the full knowledge that house prices and rental rates significantly outstrip any figures determined by the scale.

Discussing it on a "Mortgage and Endowments" forum rather than a general economy forum indicates where peoples' concerns really lie.