Are we expecting the BOE Base Rate to drop to 3.75% on the 6th November 2025?

Altior

Hoenir said:

Altior said:

BoE drops rates and reported inflation spikes !

Some perilous times ahead for them (and for us!)

Inflation is forecast to reach 3.7% by the BOE during the course of 2025.  This unexpected figure probably kills off any chance a further reduction in Base Rate anytime soon. 

They will just mirror the Fed in my view, who appear to be luke warm on further rate cuts for the time being. Although one can definitely see some political pressure being exerted by the new administration. 

Hoenir

Altior said:

Hoenir said:

Altior said:

BoE drops rates and reported inflation spikes !

Some perilous times ahead for them (and for us!)

Inflation is forecast to reach 3.7% by the BOE during the course of 2025.  This unexpected figure probably kills off any chance a further reduction in Base Rate anytime soon. 

They will just mirror the Fed in my view, who appear to be luke warm on further rate cuts for the time being. Although one can definitely see some political pressure being exerted by the new administration. 

The US has it's own challenges. Even Trump cannot bully the bond markets though. As can be seen in the rise of Treasury yields despite the fall in the cost of borrowing. The Fed's Reserve Rate isn't the same as BOE base rate. The Fed sets the rate at which commercial banks lend to each other overnight whereas the BOE sets a rate at which it will lend to commercial banks overnight. In the US mortgage rates are driven by the 10 year Treasury stock yield. 

Altior

Hoenir said:

Altior said:

Hoenir said:

Altior said:

BoE drops rates and reported inflation spikes !

Some perilous times ahead for them (and for us!)

Inflation is forecast to reach 3.7% by the BOE during the course of 2025.  This unexpected figure probably kills off any chance a further reduction in Base Rate anytime soon. 

They will just mirror the Fed in my view, who appear to be luke warm on further rate cuts for the time being. Although one can definitely see some political pressure being exerted by the new administration. 

The US has it's own challenges. Even Trump cannot bully the bond markets though. As can be seen in the rise of Treasury yields despite the fall in the cost of borrowing. The Fed's Reserve Rate isn't the same as BOE base rate. The Fed sets the rate at which commercial banks lend to each other overnight whereas the BOE sets a rate at which it will lend to commercial banks overnight. In the US mortgage rates are driven by the 10 year Treasury stock yield. 

To my benefit I've made my personal finance judgements on what the BoE will do being based on the Fed narrative. It has served me particularly well. No more obvious example than when the BoE were copying the Fed's narrative about inflation being 'transitory' when all the money printing was obviously hitting the real economy at the end of lockdowns, and it was palpably far from transitory. Anyone with a semblance of economic instinct knew that rates needed to be hiked to curb inflation.  

Altior

I'd actually argue now that anyone with a semblance of economic instinct knows that we should not be reducing central rates. But they've already cut twice, with more predicted this year.

RelievedSheff

They will hold the rates next month.

Hoenir

Altior said:

Hoenir said:

Altior said:

Hoenir said:

Altior said:

BoE drops rates and reported inflation spikes !

Some perilous times ahead for them (and for us!)

Inflation is forecast to reach 3.7% by the BOE during the course of 2025.  This unexpected figure probably kills off any chance a further reduction in Base Rate anytime soon. 

They will just mirror the Fed in my view, who appear to be luke warm on further rate cuts for the time being. Although one can definitely see some political pressure being exerted by the new administration. 

The US has it's own challenges. Even Trump cannot bully the bond markets though. As can be seen in the rise of Treasury yields despite the fall in the cost of borrowing. The Fed's Reserve Rate isn't the same as BOE base rate. The Fed sets the rate at which commercial banks lend to each other overnight whereas the BOE sets a rate at which it will lend to commercial banks overnight. In the US mortgage rates are driven by the 10 year Treasury stock yield. 

To my benefit I've made my personal finance judgements on what the BoE will do being based on the Fed narrative. It has served me particularly well. No more obvious example than when the BoE were copying the Fed's narrative about inflation being 'transitory' when all the money printing was obviously hitting the real economy at the end of lockdowns, and it was palpably far from transitory. Anyone with a semblance of economic instinct knew that rates needed to be hiked to curb inflation.  

As with the ECB's actions. The elsastic eventually breaks and the direct correlation is no more. The US's greatest challenge is the short term nature of it's National debt. Trump and Musk are aware of the implications. Whether DOGE is the way to go about this is another topic of discussion all together. 

movilogo

BoE is likely to hold rates in March. May be it will down around May, depending on inflation numbers.

IAMIAM

Surprised it was held

Hoenir

IAMIAM said:

Surprised it was held

Inflation is tracking up. Hasn't been contained yet. On top of which we have uncertainty by the bucket load. 

housebuyer143

IAMIAM said:

Surprised it was held

I'm not. Look at what's happened. Labour have increased costs to businesses and this is causing unemployment, then you have significant increases in costs which is hampering spending. And now they are out their threatening people's PIP monies - no wonder no one is interested in spending money. 

If you give the whole country a payrise you can kind of expect inflation to increase. 
They have no plans for growth with their aim from the original budget for growth as LESS than the rate of inflation - how can that be the aim? We will be in a recession before long.

My water bill went up 32%, gas another 7%, council tax 8%, internet 10%, and the cost of meat in particular is insane compared to even a year ago. My pay rise at work was 2.7%, so with the frozen tax bands and huge increases I am worse of every month. My CT in 3 years will be 4k if they keep increasing it at the rate they have been since COVID. I'm really not sure why they think the economy would be growing!