Interest Rates

[griffgrog]

Given the MPC are meeting again very soon, what's everyones prediction on their next move and what do you think rates will top out at?

[TDIPLC]

The smart money seems to be on another 0.25% rise. There are some on the panel that want a 0.5% rise.

I read recently that some substantial hedge funds have suffered due to the rampant defaulting on US poverty (sub prime) mortages have created a credit crisis which is bound to impact on us sooner or later.

Hopefully a PHer with a deeper undertstanding will be along to explain better or tell me that I'm wrong.

[g4ry13]

Not sure, it was close last month. Odds are favouring no change this month. 35-1 on +0.25% and 99-1 on +0.50%. I personally wouldn't mind putting a few pounds on +0.25% but nothing substantial. I may also take a quick spread-bet out at 12:00 on Thursday.

[limpsfield]

Bloomberg.com is always good for this stuff. It is a question of when not if at the moment.

"HSBC Holdings Plc, Europe's biggest bank by market value, this week revised up its forecasts for rates in the U.K. It now expects the BOE's benchmark rate to peak at 6 percent in September, after earlier forecasting it would by then reach 5.75 percent."

http://www.bloomberg.com/apps/news?pid=20601102&am...

[ACEparts_com]

I know a man who works at the BOE as a researcher and even he hasn't a clue as to what's going on.
My guess is up by 0.25% but followed by several more unless they get brave and go for 0.5% now.
All the markets are prepared for 0.25% so it's not going to come as any surprise but 0.5 might wake a few people up.

[tigger1]

There's talk that the market needs a "shock", i.e. an increase of 0.50%, rather than a slow climb of many 0.25% rises.

Thankfully, I think I am "covered" whichever way the rate goes, so long as the economy doesn't fall over.