Base Rates - Where to by the end of the year ?

KeithEssex_2

Where do you think that base rates will be by the end of the year ?

I'm thinking that there will be 1 or 2 rises this year and then similar reductions in 2009.

BBC - "Bank lowers interest rates to 5%" - 10/04/08
http://news.bbc.co.uk/1/hi/business/7340142.stm

Aegis

My guess is that it'll be more or less where it is now. There's economic pressure downwards from the unstable markets, and upwards from rising interest rates. I think we're due a period of turbulent share prices and inflation somewhat above the government targets, and believe that these two forces will effectively make large movements in either direction infeasible.

Of course, my opinion and 10p will still only get you 10 penny sweets (assuming that penny sweets still cost a penny, of course!)

KeithEssex_2

Aegis wrote: »

My guess is that it'll be more or less where it is now. There's economic pressure downwards from the unstable markets, and upwards from rising interest rates. I think we're due a period of turbulent share prices and inflation somewhat above the government targets, and believe that these two forces will effectively make large movements in either direction infeasible.

Of course, my opinion and 10p will still only get you 10 penny sweets (assuming that penny sweets still cost a penny, of course!)

I can't think of anything that costs less than 10p these days !!!

It's been years since I bought a penny chew they probably cost 25p now.

pfpf

KeithEssex wrote: »

I can't think of anything that costs less than 10p these days !!!

a plastic carrier bag in M&S costs 5p.

[Deleted User]

KeithEssex wrote: »

I can't think of anything that costs less than 10p these days !!!

It's been years since I bought a penny chew they probably cost 25p now.

Sausages!

And what manky sausages they must be too!

ManAtHome

I reckon +0.5% as well, but not because they're going to be pre-emptive. I suspect real interest rates (commercial banks) will rise to cover increasing defaults from consumers and companies - this will give more 'headroom' for poundland to 'talk tough' on inflation, but still be a good percent or so under real lending rates.

KeithEssex_2

Deleted_User wrote: »

Sausages!

And what manky sausages they must be too!

http://www.telegraph.co.uk/news/newstopics/howaboutthat/2068130/Asda-launches-2p--'credit-crunch'-sausages.html

But can you buy these individually ? If not the carrier bag is winning.

KeithEssex_2

ManAtHome wrote: »

I reckon +0.5% as well, but not because they're going to be pre-emptive. I suspect real interest rates (commercial banks) will rise to cover increasing defaults from consumers and companies - this will give more 'headroom' for poundland to 'talk tough' on inflation, but still be a good percent or so under real lending rates.

Gordon Brown has got himself in a hole. They just seem to be trying to undermine the Bank of England these days.

I'm definitely a hawk in this instance.

ManAtHome

KeithEssex wrote: »

But can you buy these individually ? If not the carrier bag is winning.

You could always start a sausage pyramid scheme - you get 8 people to give you an 'asda special', then they have to sign up 8 each etc (not sure whether you'd end up a sausageionaire or just with a bad dose of sausageionaires...).

tradetime

KeithEssex wrote: »

Where do you think that base rates will be by the end of the year ?

I'm thinking that there will be 1 or 2 rises this year and then similar reductions in 2009.

BBC - "Bank lowers interest rates to 5%" - 10/04/08
http://news.bbc.co.uk/1/hi/business/7340142.stm

I'd be inclined to agree with the 1-2 rises this year, fwiw, beyond that too hard to predict given the inflation backdrop. I think inflation is likely to remain stubbornly high given that it is a widespread global phenomenon.

KeithEssex_2

tradetime wrote: »

I'd be inclined to agree with the 1-2 rises this year, fwiw, beyond that too hard to predict given the inflation backdrop. I think inflation is likely to remain stubbornly high given that it is a widespread global phenomenon.

It's amazing how sentiment has changed so dramatically over the last 5-6 weeks. Not one person is now predicting a cut in base rates.

Historic Base Rate Data
http://www.houseweb.co.uk/house/market/irfig.html

So when do people think that they will move next ?

MPC Decision Dates for 2008
9 & 10 July
6 & 7 August
3 & 4 September
8 & 9 October
5 & 6 November
3 & 4 December