'Tricky decision' for Bank of England to raise rates - CBI economist
Anna Leach, deputy chief economist at the CBI business group, says the interest rate rise to 4.25% is a "tricky one for the MPC ( Monetary Policy Committee)".
Leach says it was done "against the backdrop of recent global financial market turbulence, a surprise rise in domestic inflation and a Budget which provided more support for the economy".
Quote Message: The MPC will also have an eye to the recent turmoil in the banking sector.
The MPC will also have an eye to the recent turmoil in the banking sector.
Quote Message: While financial stability is the remit of the FPC (Financial Policy Committee), an excessive tightening in credit conditions for businesses and households arising from financial market turbulence could cause the MPC to reconsider the level of interest rates in future months." from Anna Leach CBI deputy chief economist
While financial stability is the remit of the FPC (Financial Policy Committee), an excessive tightening in credit conditions for businesses and households arising from financial market turbulence could cause the MPC to reconsider the level of interest rates in future months."
Anna Leach
CBI deputy chief economist
And another example
Blanchflower says there is huge incoherence in latest rate hike
Let's go back to Radio 4's The World at One where economist Danny Blanchflower has been giving his views on today's announcement,.
Blanchflower, you may remember, was one of the Bank of England's policymakers during the 2008 financial crisis, and has been calling for interest rates to be cut.
He says the Bank putting rates up again is a mistake.
"Over the last two weeks, the shenanigans that have gone on in global financial markets is basically equivalent to a 2% rise in interest rates," he tells the programme.
"That's going to clamp down on the economy hugely."
He adds there's a "huge incoherence" in the hike.
The Bank's own February forecasts of three years of no economic growth, then rates inflation dropping below its 2% target by 2024 and the recent market turmoil shows the Bank should be cutting rates, he says.
Perhaps this cove Blanchflower is as our toilet boy suggested is a secret islamofascist and Erdogan supporter as he is suggesting using Erdogan police on interest rates. Who knows what rat will crawl out of the next stone.
And finally consequences
Neil Sutton's monthly mortgage payments were £255 before they started going up in January 2022. They’ve just had a letter to say they’ll rise to £1,465 from next month. And today's rise means they'll be going up even further after that.
Quote Message: There's not a lot that you can do other than to try and work that much harder to find the extra £150 odd a month. I don't really have an awful lot of choice, he says.
There's not a lot that you can do other than to try and work that much harder to find the extra £150 odd a month. I don't really have an awful lot of choice, he says.
Quote Message: I think I'm just so used to going up every other month that I'm blasé to it. You know, you just despair, quietly, inwardly, but you know, I can't let that show.
I think I'm just so used to going up every other month that I'm blasé to it. You know, you just despair, quietly, inwardly, but you know, I can't let that show.
Mr Sutton's 20 year mortgage comes to an end next March, when he says he won't be able to afford to remortgage.
"So I guess the bottom line is that we're going to have to move."
I do wonder if Mr Sutton voted for the Swine party though?