Mortgage Rate Rises

[200sols]

Base rate will go down today, doesn't mean mortgage rates will go down.

 

[hood1971]

Rates will continue to drop and drop because the housing market is buggered. Then when the next crash comes in the following decade we will be back where we started with high rates again further kicking the can down the road

If Trump goes through with protectionist tariffs then prices will rise in US and Europe, leaving BOE with very little choice on tackling inflation.
We have 3 year fix at 3.75% ending January and online offer was 5.5% for 5 year fix which feels a bit like the usual loyalty discount (screwing customer)

 

[Chris344]

BoE cuts to 4.75%

 

[jaybee]

BoE cuts to 4.75%

Out of interest, how did you find out so quick? WHere announces it? NEws sites seem to not update yet?

 

[Chris344]

Out of interest, how did you find out so quick? WHere announces it? NEws sites seem to not update yet?

https://news.sky.com/story/money-in...of-england-consumer-news-latest-live-13040934 - announced at 12 on the dot. Reporters are held up in the basement at the BoE to get the message out once confirmed.

 

[Chris C]

Out of interest, how did you find out so quick? WHere announces it? NEws sites seem to not update yet?

Out of....interest... I see what you did there

"We now think rates will fall only as far as 3.5% in early 2026 rather than to 3%" which I still don't think is all that bad considering where they've been. inflation expected to increase slightly as well

 

[jaybee]

"We now think rates will fall only as far as 3.5% in early 2026 rather than to 3%" which I still don't think is all that bad considering where they've been. inflation expected to increase slightly as well

Who said that?

The live conference now is on where it's all being explained.

 

[Michael Myers]

renewal for me in 2026 so hopefully it can do better than 3.5 but we shall see... not going to get my hopes up though with all that's going on

 

[jaybee]

Four ways the economy could react to national insurance changes

Bank of England governor Andrew Bailey says there are four ways in which the increase in employer national insurance contributions could play out in the economy.

"It represents an increase in the cost of employment," he explains.

The "four margins of adjustment" he gives as possibilities are:

• Firms could pass on higher costs to consumer prices
• All firms could absorb the increase through lower margins or higher productivity
• Firms could increase wages by less, or
• Firms could respond by reducing employment.

I feel like the most likely one is just raising prices for consumers as per usual. The governor also agrees that the path of inflation is set to rise as a result of the budget.

 

[Chris C]

Who said that?

The live conference now is on where it's all being explained.

Paul Dales, chief UK economist at Capital Economics

 

[200sols]

Paul Dales, chief UK economist at Capital Economics

At this stage these forecasts are meaningless. Soon you'll have a madman in the US about to start a trade war, our interest rate and economic future really depends on what Trump does..

 

[Chris344]

At this stage these forecasts are meaningless. Soon you'll have a madman in the US about to start a trade war, our interest rate and economic future really depends on what Trump does..

Exactly. Analysts predict that central banks may need to raise interest rates again to combat the inflation this could generate.

 

[413x]

I don't really see why interest rates need to go up in this case to beat inflation from this.

If prices rise and people have same/less cash surely some companies will go under due to less sales. Or have to lay off staff.
Meaning less public spending and thus inflation ebbs away on its own.