Interest rate move on Thursday
Discussion
I've got no view as I haven't been paying attention, but looking at the sterling money markets, they are not pricing in any increase in rates. If the BoE does tighten it'll come as a big surprise to the market by the look of the prices. To illustrate the point, the BoE Base Rate is at 4.75% and 3 month deposits were on offer today at 4.70% in the interbank market. If anything the market is pricing in a gradual easing of rates ... 12 month LIBOR fixed at 4.52% today, which suggests the market expects average rates in the next 12 months to be 0.25% lower than they are today ... perhaps a 0.25% cut in 4 months time and then another 25bp cut 4 months after that.
>> Edited by ATG on Monday 4th July 18:32
>> Edited by ATG on Monday 4th July 18:32
dieseldog said:
I'm pretty sure it will stay the same or go down 0.25%
that gets my vote.
swap rates are low, fixed rate deals on mortgages are dropping and have been for a while, housing market is still slowing down and spending has slumped...
my best guess is one more month of 4.75% then a cut of 0.25% - no predictions any further in to the future than that from me!
IMO will stay the same. I know from having seen so many clients in precarious postions that one quarter point shift is gonna bankrupt a lot of people. You will be very surprised how close some of the less prudent investors sail to the edge.
I believe the government know this and obviously want to avoid creating a vaccuum in the economy and even more bad publicity. It comes to something when you are relying on a big-up form Geldof!
On the plus side, it leaves the rest of us with a lot of cheap repos
I believe the government know this and obviously want to avoid creating a vaccuum in the economy and even more bad publicity. It comes to something when you are relying on a big-up form Geldof!
On the plus side, it leaves the rest of us with a lot of cheap repos
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