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

Strummer22

Awaiting tomorrow's inflation figures. https://tradingeconomics.com/united-kingdom/inflation-cpi

The 'forecast' and 'consensus' figures have trended slightly above the actual result in recent months. We'll see whether that continues. 

Today's earnings figures were pretty much as expected. If inflation is also about as expected, I think there will be another 5/4 split in favour of holding rates on 2nd November. 

RelievedSheff

Rates will be held again if tomorrows inflation figures don't throw up any great surprises and continue on their downwards trend.

london21

If inflation figures keep dropping then think rates will stay the same.

2 years fixed currently 5.49% 65% LTV will see how low it will get until January.

michaels

WE have seen oil (and therefore petrol) prices head up again so I guess inflation may be a bit higher than it would have been without this.  In general it is not clear whether demand has weakened enough for suppliers to no longer apply regular price increases.  Employment seems to be slowly weakening but there are still lots of sectors with shortages.

lmitchell

Rates will be unchanged. 1.25% fall in inflation baked in for next month. Money supply and lending at its lowest levels since 2010. There's no further tightening required whatsoever.

MattMattMattUK

I suspect we might see a rise at the next MPC meeting, to 5.5%, as inflation did not drop again this month. 

Strummer22

The two posts above are both right IMO - no more tightening is required, but we might still see a rise at the next MPC meeting. I think BoE may still be a bit scared of not being seen to do enough to tackle inflation. 

michaels

Strummer22 said:

The two posts above are both right IMO - no more tightening is required, but we might still see a rise at the next MPC meeting. I think BoE may still be a bit scared of not being seen to do enough to tackle inflation. 

One thing has been clearly demonstrated, there are very long lags before the impact of monetary policy are felt - this is pretty worrying news if we do enter recession next year, cutting rates is not a tool that could be used to solve the problem with any speed

MattMattMattUK

michaels said:

Strummer22 said:

The two posts above are both right IMO - no more tightening is required, but we might still see a rise at the next MPC meeting. I think BoE may still be a bit scared of not being seen to do enough to tackle inflation. 

One thing has been clearly demonstrated, there are very long lags before the impact of monetary policy are felt - this is pretty worrying news if we do enter recession next year, cutting rates is not a tool that could be used to solve the problem with any speed

This is what many people seem to forget, demonstrated by the fact that around half of mortgages and corporate lending are still on pre-rise rates and will not feel the pain until next year or beyond and others fixed early in the rises so are on comparatively low rates as well. Even when the rates stop rising that will continue to have an impact for 5+ years as people remortgage onto high rates. The current rises have sucked so much money out of the economy that we are almost guaranteed a recession and it will not be easy to get out of as those high interest rates continue to such money out of the real economy. 

lmitchell

MattMattMattUK said:

michaels said:

Strummer22 said:

The two posts above are both right IMO - no more tightening is required, but we might still see a rise at the next MPC meeting. I think BoE may still be a bit scared of not being seen to do enough to tackle inflation. 

One thing has been clearly demonstrated, there are very long lags before the impact of monetary policy are felt - this is pretty worrying news if we do enter recession next year, cutting rates is not a tool that could be used to solve the problem with any speed

This is what many people seem to forget, demonstrated by the fact that around half of mortgages and corporate lending are still on pre-rise rates and will not feel the pain until next year or beyond and others fixed early in the rises so are on comparatively low rates as well. Even when the rates stop rising that will continue to have an impact for 5+ years as people remortgage onto high rates. The current rises have sucked so much money out of the economy that we are almost guaranteed a recession and it will not be easy to get out of as those high interest rates continue to such money out of the real economy. 

If they suck much more money out of the economy, we're in danger of having something worse than 2008. There needs to be some common sense and stability otherwise we could hugely overtighten and have a more dangerous period of deflation in 2025-26.