Bank of England poised to raise rates by most in 33 years

[murraypaul]

I still maintain that the cause of the reaction to the Kwarteng budget was the absolute failure of the Bank of England to do anything the previous day, when the market had been expecting a 1% increase in Base Rate. They are still havering about what to next.

So how do you explain the markets recovering each time part of the not-a-budget was rolled back?

[scotview]

So how do you explain the markets recovering each time part of the not-a-budget was rolled back?

Yip, and why was there absolutely no Market/BoE/Treasury reaction to Rishi's £600B Covid spend.

Sunak's £600B is £600B, Truss's £40B is £40B, Big number, small number, regardless of sentiment.

Curiouser and curiouser.

[murraypaul]

So how do you explain the markets recovering each time part of the not-a-budget was rolled back?

Yip, and why was there absolutely no Market/BoE/Treasury reaction to Rishi's £600B Covid spend.

Sunak's £600B is £600B, Truss's £40B is £40B, Big number, small number, regardless of sentiment.

Curiouser and curiouser.

Presumably because the market thought Sunak's plans were a sensible reaction to the situation at time A while Truss's were not a sensible reaction to the situation at time B.

If I tell you I'm going to spend £400k on a house or £50k on beanie babies, would you react worse to the former, just because the number is bigger?

[AsleepInYorkshire]

The Fed have also hinted that this may be the last of the big raises as they want to wait and see the effect of the recent decisions.

BoE are suggesting they see UK interest rates topping out at 4.5% next autumn. They also predict a 2 year recession.

Cliché time, we are where we are, it is what it is

AiY(D)

[scrumpyjack]

and 4.5% is trivial compared to the rates prevailing in my youth

[Dod101]

and 4.5% is trivial compared to the rates prevailing in my youth

And we are not there yet. Now 3% seems to have been confirmed for now.

Dod

[ursaminortaur]

and 4.5% is trivial compared to the rates prevailing in my youth

But then House prices were much lower and Mortgages weren't at 6 or 7 times salary - that's affordable with the low interest rates we have had for a decade but less so as they rise back to what before that were normal rates ( or god forbid the double digit rates we had in the 1980s and early 1990s ).

[odysseus2000]

After Powell’s statement on Wed & todays jobs report:

https://www.google.com/amp/s/amp.thegua ... -elections

It looks like higher rates are coming.

So the big question is what us rates will produce inflation at 2%. I fear we are not close & many us employers have started to cut pay roll numbers. This is getting ugly quickly!

Regards,