Next recession?

[Gordon999]

There is something seriously wrong in the property market when inflation rate is nearly 9% but the mortgage interest rate is still kept down at 2% -3% level by BOE's bank rate. . Many pensioners are getting less than 1 % interest on their savings.
The price of electricity charge went up by £700 per household this April and the bill is forecast to rise by 40|% in October . The price of petrol per litre, has risen from around £1.20 to £1.85 since one year ago.

The recession is here but the BOE does not see it.

[Gordon999]

WION News channel is forecasting the BOE will have to raise interest rates again . Last rise ( on 5 May), BOE raised the interest rate from 0.75% to 1% .

Since inflation rate is heading up to 10% , WION is forecasting the interest rate reaching 2.25% at end of 2022 , and rising to 3% at end of 2023.

[BTL investor]

WION News channel is forecasting the BOE will have to raise interest rates again . Last rise ( on 5 May), BOE raised the interest rate from 0.75% to 1% .

Since inflation rate is heading up to 10% , WION is forecasting the interest rate reaching 2.25% at end of 2022 , and rising to 3% at end of 2023.

Predictions in this report that 3% will be reached by March 2023. Needs to in my opinion.
https://m.youtube.com/watch?v=HyiflDxqgLs

[Gordon999]

The rail workers strike expected on 21 , 23 and 25 Jun will prevent many office staff getting to work, and means less productivity in that week is a form of recession ( by less pay for many families )..

[Gordon999]

The UK’s central bank lifted its benchmark rate to 1.25% today, from 1%, the fifth rise in as many meetings. Three policymakers wanted a bigger rise, to 1.5%, but were outvoted.

The Bank also predicted that inflation will soar to 11% this autumn when the cap on energy bills is next lifted, and that UK GDP will shrink by 0.3% this quarter.

It pledged to take further action if needed

[Gordon999]

Yesterday, the USA raised the interest rate by 0.75% to 2 %. It becomes costly for UK to follow .

[Gordon999]

Mortgage interest rates are rising. Today's Sunday Telegraph ( 19 Jun) shows the "best buy mortgage" for 2 year fixed rate at 2.81% . Three weeks ago the same mortgage was quoted by Financial Times at 2.2%.

So if you are re-mortgaging , get it done before the next increase in interest rate.

[Gordon999]

Yesterday's by-election was a win for Lab and Lib-dem. People are voting against the government because energy bills have gone up £700 for everybody and petrol has gone up 70p per litre from last year.

This hurts every household in UK and the Ministers have no idea how to stop the price rises.

[Neelix]

I think the current inflation and energy costs are pretty much all of the developed world and there’s little that individual countries can actually do about it.

that said I do think that the green levy on electricity should be cancelled immediately, along with VAT on the first £1000 of domestic bills

[SouthernDave]

Mortgage interest rates are rising. Today's Sunday Telegraph ( 19 Jun) shows the "best buy mortgage" for 2 year fixed rate at 2.81% . Three weeks ago the same mortgage was quoted by Financial Times at 2.2%.

So if you are re-mortgaging , get it done before the next increase in interest rate.

We’ve just mortgaged 2 properties and got better rates than what we got on some property this time last year, so we were pretty happy at 3.4%

[loanarranger]

SouthernDave has done well , rates are increasing at an alarming rate ,HMO/MUFB Fixed for 5 years are now starting from 3.49% with a 2% fee and the bulk now approaching the 4% level if not higher.

Because of the rise in Swap Rates some lenders are repricing within days of previously announcing new rates ,as a broker it is now difficult to be 100% accurate until the application has been granted an AIP and a full application submitted and the initial fees paid.

[SouthernDave]

loanarranger,

We have used State Bank of India for the most recent one.

[loanarranger]

They are indeed a fine lender and worthy of serious consideration by brokers. Best regards.

[SouthernDave]

They are indeed a fine lender and worthy of serious consideration by brokers. Best regards.

Good to know!

[Gordon999]

The Sunday Telegraph ( 19 June 2022) Liam Halligan reported " BOE still has its head in the sand."

Last wednesday, the Fed ( USA) jacked up US rates by 0.75% . Thats why the dollar strengthened and made imports cheaper.
Its astonishing that the Monetary Policy Committee ( BOE ) voted 6-3 to raise borrowing costs by 0.25% points. That makes no sense. Our central bank has been hopelessly " behind the curve for well over a year". Its was clear back in March last year that inflation would become a major problem as UK emerged from lockdown. Mr Halligan has noted three observations .
1. This slowdown is happening whatever the policy settings. An extra 100 points will not make much difference to GDP but could do a great deal to anchor inflation expectations.
2. MPC proceedings are clearly dominated by insiders . External members are consistently out voted by in-house people who seem to vote as a block. No internal member has voted against the consensus since 2013.
3. Unless the MPC uses its independence, then the BOE and country will lose it.