MPC minutes show 5-4 split on rates reduction

Woby_Tide

http://www.bankofengland.co.uk/publications/minutes/mpc/pdf/2005/mpc0507.pdf

latest minutes from the July meeting

GreenB_2

I expect a drop in interest rates in the next two months and suspect that will cause a little morre activity in the housing market.
Also I expect a fair few people to remortgage to take advanatge of new deals (even though fixed rates have dropped recently people assume they don't unless there is a BoE rate drop)

meanmachine_2

Not unexpected.

But if there is a cut, it's a question of whether it will be followed by further cuts.

Also, yet again I find myself, as a saver, being penalised and having to prop up greedy borrowers who simply can't live within their means.

An economy brought to its knees by a rate of 4.75%? Spells trouble to me.

John_M_Business

meanmachine wrote:

Not unexpected.

But if there is a cut, it's a question of whether it will be followed by further cuts.

Also, yet again I find myself, as a saver, being penalised and having to prop up greedy borrowers who simply can't live within their means.

An economy brought to its knees by a rate of 4.75%? Spells trouble to me.

The glass is always half-empty, isn't it? Rather like the buying / selling situation...

"Greedy sellers" v "Cheapskate buyers"

Actually, although low historically for the UK, the IR at the moment is reasonable compared with most of the developed world.

Additionally, if you read the minutes, you'll see that there's a lot more being considered when it comes to IR than purely what is happening in property. It's just one of a number of factors.

meanmachine_2

I didn't even mention property. I'm talking about savers like me who continue to get poor returns because the rest of the country continues to go on a credit binge.

By the way, how's your house sale going?

GreenB_2

meanmachine wrote:

I didn't even mention property. I'm talking about savers like me who continue to get poor returns because the rest of the country continues to go on a credit binge.

Whats the old saying? If you can't beat them - join them!

Seriously though, many people believe property investment is saving.
(personal decision whether this is right or not)

michaels

Real return of 2.75% for instant access isn't that bad to me - often when rates have been higher real returns have actually been negative

zag2me

Great news for me, I start paying my mortgage next month, and its on a discount tracker. Hope the rates do go down at the next meeting.

John_M_Business

meanmachine wrote:

By the way, how's your house sale going?

A very unexpected and unfortunate setback - but something you can't legislate for: the father of my purchaser died suddenly, and he's had to go back to France. So he's pulled out as he's not in a position to exchange until the dust settles (at least a month or so).

So back to the other offer, and if he's gone, then back to the drawing board. But at least the two offers we had give us a very good indication of what someone is willing to pay for our home... keep you posted.

We're in no immediate hurry.

ManAtHome

I don't think that a fiver a week saving on a £100k mortgage is really going to start carnivals in the streets. I'm more interested in whether GB 'realignment' of the economic cycle will defer or reduce pending tax rises (perhaps until Pickfords move him from number 11 to number 10).