Bank of England - hold or lower?

[Dolph]

So if the figures don't show what you think they should, they are fudged?

 

[div0]

So if the figures don't show what you think they should, they are fudged?

I think if they don't show the whole picture, then its fair for someone to point out where any flaws may lie when analysing the results.

 

[Dolph]

But they are the figure that matters, the one that has to stay within a target. If CPI had jumped to 3% this month, there would have been people all over it saying "I told you so"

 

[The Mad Rapper]

So if the figures don't show what you think they should, they are fudged?

Of course they are fudged.

The RPI which is a more accurate indicator of inflation in the eyes of many is up .1% to 4.3%!

The CPI is the lackey of a Government desperate to try and keep a lid on inflation - it's a pie in the sky figure and as others have alluded, is worthless.

 

[Dolph]

Of course they are fudged.

The RPI which is a more accurate indicator of inflation in the eyes of many is up .1% to 4.3%!

The CPI is the lackey of a Government desperate to try and keep a lid on inflation - it's a pie in the sky figure and as others have alluded, is worthless.

RPI includes mortgage rates does it not, so will be showing the tightening of rates in the mortgage market. Surely in that case a rate cut is a good thing?

 

[Haircut]

RPI includes mortgage rates does it not, so will be showing the tightening of rates in the mortgage market. Surely in that case a rate cut is a good thing?

RPIX, which excludes mortgage interest payments, is a better rate to use IMO as this was the rate that used to be targeted prior to CPI.
This increased from 3.1% to 3.2% in November.
When this was targeted 2.5% was the target.

Interesting that the two seem to be diverging now.

IMO inflation will start to pick up early to mid next year, I think we may see a fall (possibly below 2%) for December on the back of strong inflation last December, but come June/July next year I'd say we will be pushing or perhaps even breaking the 3% barrier for CPI.

 

[aardvark]

So if the figures don't show what you think they should, they are fudged?

the figures don't reflect reality - i'm a scientist - i know a complete load of steaming crap when i see it, and its the CPI.

 

[carpmaster]

2.1% is so far removed from reality it's simply laughable.

"The Office for National Statistics said gas and electricity bills were falling at an annual rate of 5.6%, the steepest fall since records began."

Oh really. Why have Npower customers gas bills just gone up by 17%?

"Npower just raised their prices by 17% due to "rising wholesale costs"."
http://www.guardian.co.uk/business/2007/dec/18/oil.utilities

Why are British Gas going to increase prices by 15% in February?
"British Gas to raise gas prices by 15% in February due to "rising wholesale costs"."
http://www.guardian.co.uk/money/2007/dec/04/householdbills.utilities

 

[carpmaster]

"Analysts had expected food to have pushed inflation higher after a surge in the price of cakes and bread drove the annual rate of food inflation to a 14-year high in October.

However, the ONS said that increases in the price of items such as bread and milk had been offset by falling vegetable prices."

The office for National Statistics? What a joke. Has anyone noticed the prices of vegetables falling in line relative to the increased prices of bread and milk?

I go shopping regularly and buy a good selection of basic vegetables. I haven't seen any prices falling whatsoever.

All I know is my shopping bills are about £20 more a week than they used to be not so long ago.

The CPI figure is quite clearly a total fudge, manipulated to allow the Bank of England to say everything is rosy & have another cut in interest rates.

 

[JAzz]

So if the figures don't show what you think they should, they are fudged?

Of course they are, are you trying to suggest the government and BoE know more about this nation's economy and how to keep it in a healthy state than the posters on the OcUK forum?

 

[The Mad Rapper]

Of course they are, are you trying to suggest the government and BoE know more about this nation's economy and how to keep it in a healthy state than the posters on the OcUK forum?

Beautiful sarcasm - I appreciate a true artist at work

On a serious note, think about vested interests and open your mind a little. There are several people posting in these financial threads who have done their research and are certainly on the money as far as their views go.

 

[The Mad Rapper]

"Analysts had expected food to have pushed inflation higher after a surge in the price of cakes and bread drove the annual rate of food inflation to a 14-year high in October.

However, the ONS said that increases in the price of items such as bread and milk had been offset by falling vegetable prices."

The office for National Statistics? What a joke. Has anyone noticed the prices of vegetables falling in line relative to the increased prices of bread and milk?

I go shopping regularly and buy a good selection of basic vegetables. I haven't seen any prices falling whatsoever.

All I know is my shopping bills are about £20 more a week than they used to be not so long ago.

The CPI figure is quite clearly a total fudge, manipulated to allow the Bank of England to say everything is rosy & have another cut in interest rates.

Exactly, the cost of lemons has risen more than 50% this month!

 

[The Mad Rapper]

RPI includes mortgage rates does it not, so will be showing the tightening of rates in the mortgage market. Surely in that case a rate cut is a good thing?

A rate cut cannot be a good thing giving the underlying fundamentals. The BoEs main remit is to control inflation. Inflation is now rising and has been for a sustained period. This is accurately reflected in the RPI which reflects inflation at 4.3%. The BoE ought to raise interest rates to combat the rise in inflation, not lower them to relieve pressure on the financial sector and home owners.

 

[scorza]

Beautiful sarcasm - I appreciate a true artist at work

On a serious note, think about vested interests and open your mind a little. There are several people posting in these financial threads who have done their research and are certainly on the money as far as their views go.

You mean they agree with you?

 

[The Mad Rapper]

IMO inflation will start to pick up early to mid next year, I think we may see a fall (possibly below 2%) for December on the back of strong inflation last December, but come June/July next year I'd say we will be pushing or perhaps even breaking the 3% barrier for CPI.

Interesting.

I am astounded that the CPI showed no change this month. I am exceedingly cynical of it's accuracy and become more so as each month passes. It's an Index that, in my view, is subject to 'massaging' to suit Government objectives. For this reason alone it cannot be relied upon.

 

[The Mad Rapper]

You mean they agree with you?

I mean they have taken the time to do their own research, drawing from multiple sources and have a good grasp of the situation.

The fact they may agree with me to varying degrees is entirely incidental. The fact that these people and myself post our views on a public forum does not negate the validity of them in any way.

 

[scorza]

I mean they have taken the time to do their own research, drawing from multiple sources and have a good grasp of the situation.

No offence, but this "research" from multiple sources seems to be mostly from their own personal experience i.e. their own personal shopping and gas bills.

 

[The Mad Rapper]

No offence, but this "research" from multiple sources seems to be mostly from their own personal experience i.e. their own personal shopping and gas bills.

Not at all. The post about the cost of lemons was tounge in cheek.

My research is from multiple respected financial sources, the FT, the Times etc.

 

[carpmaster]

Apparantly the government is "so worried about inflation" that they decided to break the binding arbitration with the police force for the first time ever, and award them a lower than inflation pay award.

But of course inflation is all hunky dory according to the BOE...........

If you saw Question Time the other day, you will see what the problem is. All the people in power have "made a bundle" from the ridiculous propery bubble. For heavens sake the woman they had on as the "property expert" has a string of BTL properties. No wonder she tried to talk up the property market saying prices won't fall, there is no bubble, and London is different so there won't be any price falls even if there are elsewhere around the country.

It's quite sickening that these people are ramping up the market at the expense of hard working families who just happened to be born a few years later and cannot buy anywhere for love nor money.

This even extends to some property experts who write articles for the mainstream papers. If you look at the Evening Standard they have just published an article saying prices will not fall according to various sources.

When you look at the sources however you find they are all estate agents!

I just wish the general population would realise that grossly over inflated house prices are bad for pretty much everyone. It's going to cost them much more to move up to a bigger house regardless of "how much they've made" from the previous house.

Saying that I think having kids for most new homeowners is virtually impossible now anyway. They have been led to believe that paying 50% or more of their combined takehome pay on the house is "normal". There's no chance in hell they will ever have children with a financial noose like that around their neck, so I guess they won't need to upsize after all!

 

[carpmaster]

Exactly, the cost of lemons has risen more than 50% this month!

A lemon is a fruit isn't it!!!