Bank of England cuts by 1.50 percent!!!!
Nov 6th 2008, 11:01 am
#1
Lost in BE Cyberspace
Thread Starter
Joined: Jul 2007
Posts: 13,553
Bank of England cuts by 1.50 percent!!!!
Bloody hell - never before etc.............
More soon.
More soon.
Nov 6th 2008, 11:15 am
#2
Not an evil hypnotist
Joined: May 2007
Posts: 1,975
Re: Bank of England cuts by 1.50 percent!!!!
Will be refreshing GBP/USD like a madman...
Nov 6th 2008, 11:16 am
#3
Lost in BE Cyberspace
Thread Starter
Joined: Jul 2007
Posts: 13,553
Re: Bank of England cuts by 1.50 percent!!!!
BoE statement............ depressing reading..............
16:09 06Nov08 DJN-DJ Verbatim: Bank of England Statement On Bank Rate
DJ Verbatim: Bank of England Statement On Bank Rate
LONDON (Dow Jones)--The following is a full text of the Bank of England
statement:
The Bank of England's Monetary Policy Committee today voted to reduce the official Bank Rate paid on commercial bank reserves by 1.5 percentage points to 3%.
The past two months have seen a substantial downward shift in the prospects for inflation in the United Kingdom. There has been a very marked deterioration in the outlook for economic activity at home and abroad. Moreover, commodity prices have fallen sharply.
Since mid-September, the global banking system has experienced its most
serious disruption for almost a century. While the measures taken on bank
capital, funding and liquidity in several countries, including our own, have
begun to ease the situation, the availability of credit to households and
businesses is likely to remain restricted for some time. As a consequence, money and credit conditions have tightened sharply. Equity prices have fallen
substantially in many countries.
In the United Kingdom, output fell sharply in the third quarter. Business
surveys and reports by the Bank's regional Agents point to continued severe
contraction in the near term. Consumer spending has faltered in the face of a
squeeze on household budgets and tighter credit. Residential investment has
fallen sharply and the prospects for business investment have weakened. Economic conditions have also deteriorated in the UK's main export markets.
CPI inflation rose to 5.2% in September. The substantial rise since the
beginning of the year largely reflects the impact of higher energy and food
prices. But commodity prices have fallen sharply since mid-summer, with oil
prices down by more than a half. Inflation should consequently soon drop back sharply, as the contribution from retail energy and food prices declines,
notwithstanding the fall in sterling. Pay growth has remained subdued. And
measures of inflation expectations have fallen back.
Since the beginning of the year, the Committee has set Bank Rate to balance
two risks to the inflation outlook. The downside risk was that a sharp slowdown in the economy, associated with weak real income growth and the tightening in the supply of credit, pulled inflation materially below the target. The upside risk was that above-target inflation persisted for a sustained period because of elevated inflation expectations. In recent weeks, the risks to inflation have shifted decisively to the downside. As a consequence, the Committee has revised down its projected outlook for inflation which, at prevailing market interest rates, contains a substantial risk of undershooting the inflation target. At its November meeting, the Committee therefore judged that a significant reduction in Bank Rate was necessary now in order to meet the 2% target for CPI inflation in the medium term, and accordingly lowered Bank Rate by 1.5 percentage points to 3.0%.
The Committee's latest inflation and output projections will appear in the
Inflation Report to be published on Wednesday 12 November.
The minutes of the meeting will be published at 9.30am on Wednesday 19
November.
Web site: www.bankofengland.co.uk
16:09 06Nov08 DJN-DJ Verbatim: Bank of England Statement On Bank Rate
DJ Verbatim: Bank of England Statement On Bank Rate
LONDON (Dow Jones)--The following is a full text of the Bank of England
statement:
The Bank of England's Monetary Policy Committee today voted to reduce the official Bank Rate paid on commercial bank reserves by 1.5 percentage points to 3%.
The past two months have seen a substantial downward shift in the prospects for inflation in the United Kingdom. There has been a very marked deterioration in the outlook for economic activity at home and abroad. Moreover, commodity prices have fallen sharply.
Since mid-September, the global banking system has experienced its most
serious disruption for almost a century. While the measures taken on bank
capital, funding and liquidity in several countries, including our own, have
begun to ease the situation, the availability of credit to households and
businesses is likely to remain restricted for some time. As a consequence, money and credit conditions have tightened sharply. Equity prices have fallen
substantially in many countries.
In the United Kingdom, output fell sharply in the third quarter. Business
surveys and reports by the Bank's regional Agents point to continued severe
contraction in the near term. Consumer spending has faltered in the face of a
squeeze on household budgets and tighter credit. Residential investment has
fallen sharply and the prospects for business investment have weakened. Economic conditions have also deteriorated in the UK's main export markets.
CPI inflation rose to 5.2% in September. The substantial rise since the
beginning of the year largely reflects the impact of higher energy and food
prices. But commodity prices have fallen sharply since mid-summer, with oil
prices down by more than a half. Inflation should consequently soon drop back sharply, as the contribution from retail energy and food prices declines,
notwithstanding the fall in sterling. Pay growth has remained subdued. And
measures of inflation expectations have fallen back.
Since the beginning of the year, the Committee has set Bank Rate to balance
two risks to the inflation outlook. The downside risk was that a sharp slowdown in the economy, associated with weak real income growth and the tightening in the supply of credit, pulled inflation materially below the target. The upside risk was that above-target inflation persisted for a sustained period because of elevated inflation expectations. In recent weeks, the risks to inflation have shifted decisively to the downside. As a consequence, the Committee has revised down its projected outlook for inflation which, at prevailing market interest rates, contains a substantial risk of undershooting the inflation target. At its November meeting, the Committee therefore judged that a significant reduction in Bank Rate was necessary now in order to meet the 2% target for CPI inflation in the medium term, and accordingly lowered Bank Rate by 1.5 percentage points to 3.0%.
The Committee's latest inflation and output projections will appear in the
Inflation Report to be published on Wednesday 12 November.
The minutes of the meeting will be published at 9.30am on Wednesday 19
November.
Web site: www.bankofengland.co.uk
Nov 6th 2008, 11:22 am
#4
Lost in BE Cyberspace
Thread Starter
Joined: Jul 2007
Posts: 13,553
Re: Bank of England cuts by 1.50 percent!!!!
And first up to the plate is Cheltenham and Gloucester, who say they will pass the cut on to their mortgage borrowers "in full".......... 
.......... while the prats at HSBC, RBS, Barclays and Nationwide are "reviewing" whether to do so..............
.......... while the prats at HSBC, RBS, Barclays and Nationwide are "reviewing" whether to do so..............
Nov 6th 2008, 11:36 am
#5
Truth is the safest lie.
Joined: Jul 2008
Location: @ the beach.
Posts: 7,241
Re: Bank of England cuts by 1.50 percent!!!!
Lloyds announced that they are pulling all new trackers this morning 
.
If I had to bet on next month I'd say they are going to need to cut again.
So this is what the 70's felt like?
Remember kids "No more boom and bust" 
.
.If I had to bet on next month I'd say they are going to need to cut again.
So this is what the 70's felt like?
Remember kids "No more boom and bust" .
Nov 6th 2008, 1:02 pm
#6
why ayeeeee man!
Joined: Jan 2008
Location: Disco Gardens...
Posts: 11,370
Re: Bank of England cuts by 1.50 percent!!!!
BoE statement............ depressing reading..............
16:09 06Nov08 DJN-DJ Verbatim: Bank of England Statement On Bank Rate
DJ Verbatim: Bank of England Statement On Bank Rate
LONDON (Dow Jones)--The following is a full text of the Bank of England
statement:
The Bank of England's Monetary Policy Committee today voted to reduce the official Bank Rate paid on commercial bank reserves by 1.5 percentage points to 3%.
The past two months have seen a substantial downward shift in the prospects for inflation in the United Kingdom. There has been a very marked deterioration in the outlook for economic activity at home and abroad. Moreover, commodity prices have fallen sharply.
Since mid-September, the global banking system has experienced its most
serious disruption for almost a century. While the measures taken on bank
capital, funding and liquidity in several countries, including our own, have
begun to ease the situation, the availability of credit to households and
businesses is likely to remain restricted for some time. As a consequence, money and credit conditions have tightened sharply. Equity prices have fallen
substantially in many countries.
In the United Kingdom, output fell sharply in the third quarter. Business
surveys and reports by the Bank's regional Agents point to continued severe
contraction in the near term. Consumer spending has faltered in the face of a
squeeze on household budgets and tighter credit. Residential investment has
fallen sharply and the prospects for business investment have weakened. Economic conditions have also deteriorated in the UK's main export markets.
CPI inflation rose to 5.2% in September. The substantial rise since the
beginning of the year largely reflects the impact of higher energy and food
prices. But commodity prices have fallen sharply since mid-summer, with oil
prices down by more than a half. Inflation should consequently soon drop back sharply, as the contribution from retail energy and food prices declines,
notwithstanding the fall in sterling. Pay growth has remained subdued. And
measures of inflation expectations have fallen back.
Since the beginning of the year, the Committee has set Bank Rate to balance
two risks to the inflation outlook. The downside risk was that a sharp slowdown in the economy, associated with weak real income growth and the tightening in the supply of credit, pulled inflation materially below the target. The upside risk was that above-target inflation persisted for a sustained period because of elevated inflation expectations. In recent weeks, the risks to inflation have shifted decisively to the downside. As a consequence, the Committee has revised down its projected outlook for inflation which, at prevailing market interest rates, contains a substantial risk of undershooting the inflation target. At its November meeting, the Committee therefore judged that a significant reduction in Bank Rate was necessary now in order to meet the 2% target for CPI inflation in the medium term, and accordingly lowered Bank Rate by 1.5 percentage points to 3.0%.
The Committee's latest inflation and output projections will appear in the
Inflation Report to be published on Wednesday 12 November.
The minutes of the meeting will be published at 9.30am on Wednesday 19
November.
Web site: www.bankofengland.co.uk
16:09 06Nov08 DJN-DJ Verbatim: Bank of England Statement On Bank Rate
DJ Verbatim: Bank of England Statement On Bank Rate
LONDON (Dow Jones)--The following is a full text of the Bank of England
statement:
The Bank of England's Monetary Policy Committee today voted to reduce the official Bank Rate paid on commercial bank reserves by 1.5 percentage points to 3%.
The past two months have seen a substantial downward shift in the prospects for inflation in the United Kingdom. There has been a very marked deterioration in the outlook for economic activity at home and abroad. Moreover, commodity prices have fallen sharply.
Since mid-September, the global banking system has experienced its most
serious disruption for almost a century. While the measures taken on bank
capital, funding and liquidity in several countries, including our own, have
begun to ease the situation, the availability of credit to households and
businesses is likely to remain restricted for some time. As a consequence, money and credit conditions have tightened sharply. Equity prices have fallen
substantially in many countries.
In the United Kingdom, output fell sharply in the third quarter. Business
surveys and reports by the Bank's regional Agents point to continued severe
contraction in the near term. Consumer spending has faltered in the face of a
squeeze on household budgets and tighter credit. Residential investment has
fallen sharply and the prospects for business investment have weakened. Economic conditions have also deteriorated in the UK's main export markets.
CPI inflation rose to 5.2% in September. The substantial rise since the
beginning of the year largely reflects the impact of higher energy and food
prices. But commodity prices have fallen sharply since mid-summer, with oil
prices down by more than a half. Inflation should consequently soon drop back sharply, as the contribution from retail energy and food prices declines,
notwithstanding the fall in sterling. Pay growth has remained subdued. And
measures of inflation expectations have fallen back.
Since the beginning of the year, the Committee has set Bank Rate to balance
two risks to the inflation outlook. The downside risk was that a sharp slowdown in the economy, associated with weak real income growth and the tightening in the supply of credit, pulled inflation materially below the target. The upside risk was that above-target inflation persisted for a sustained period because of elevated inflation expectations. In recent weeks, the risks to inflation have shifted decisively to the downside. As a consequence, the Committee has revised down its projected outlook for inflation which, at prevailing market interest rates, contains a substantial risk of undershooting the inflation target. At its November meeting, the Committee therefore judged that a significant reduction in Bank Rate was necessary now in order to meet the 2% target for CPI inflation in the medium term, and accordingly lowered Bank Rate by 1.5 percentage points to 3.0%.
The Committee's latest inflation and output projections will appear in the
Inflation Report to be published on Wednesday 12 November.
The minutes of the meeting will be published at 9.30am on Wednesday 19
November.
Web site: www.bankofengland.co.uk
Nov 6th 2008, 2:11 pm
#7
Lost in BE Cyberspace
Joined: Dec 2006
Posts: 23,434
Re: Bank of England cuts by 1.50 percent!!!!
It means if you have amonthly payment of say 1,000 pounds, you will pay a bit more than AED1,000 acouple of months later, instead of paying say AED5.5-6,000 that you're doing now...
Nov 6th 2008, 8:09 pm
#8
Truth is the safest lie.
Joined: Jul 2008
Location: @ the beach.
Posts: 7,241
Re: Bank of England cuts by 1.50 percent!!!!
Nov 7th 2008, 3:39 am
#9
Lost in BE Cyberspace
Thread Starter
Joined: Jul 2007
Posts: 13,553
Re: Bank of England cuts by 1.50 percent!!!!
An economy going down the toilet, with consumer spending shrinking, negative real interest rates about to be accompanied by increasing levels of negative equity, and without the benefit of a high interest rate/yield to attract investors - I wouldn't touch GBP with a disinfected barge pole right now...........
Nov 7th 2008, 4:31 am
#10
Not an evil hypnotist
Joined: May 2007
Posts: 1,975
Re: Bank of England cuts by 1.50 percent!!!!
I've heard the thinking is, it'll give a strong boost to the UK economy, hence reducing pressure on sterling.
Not that I believe it, but that's what some experts are saying.
From my brokers, pre the announcement:
Not that I believe it, but that's what some experts are saying.
From my brokers, pre the announcement:
The Bank is widely expected to cut rates from 4.5% as its tries to prevent a long and painful recession. PWC is calling for a cut to 4% in its economic outlook, which predicts a recession in 2009. But some economists want the Bank to go further and cut rates by one percentage point to 3.5%, which would be the biggest cut since 1993, and the largest since the government handed over control of interest rate decisions to the BoE. The interest rate decision will be announced at midday GMT tomorrow. We expect the pound to strengthen if the rates are cut by more than 50 basis points, as the market will interpret it as an aggressive move to strengthen the economy in the face of recession.
Nov 7th 2008, 5:23 am
#11
ex-expat
Joined: Nov 2008
Location: in front of my computer - in sunny Sussex!
Posts: 2,162
Re: Bank of England cuts by 1.50 percent!!!!
Yes, the pound is weak at the moment, but is traditionally strong, and the British economy is generally very stable... there's no doubt that the pound will recover, it's just a matter of timescale.
Gosh, this news makes me almost wish I had a mortgage back home... hahah, not really!
Gosh, this news makes me almost wish I had a mortgage back home... hahah, not really!
Nov 7th 2008, 5:32 am
#12
Lost in BE Cyberspace
Thread Starter
Joined: Jul 2007
Posts: 13,553
Re: Bank of England cuts by 1.50 percent!!!!
Yes, the pound is weak at the moment, but is traditionally strong, and the British economy is generally very stable... there's no doubt that the pound will recover, it's just a matter of timescale.
Gosh, this news makes me almost wish I had a mortgage back home... hahah, not really!
Gosh, this news makes me almost wish I had a mortgage back home... hahah, not really!
As per usual, it wil be the US consumer dragging the rest of the world out of recession by importing their goods. The US cut rates from Sept 2007 onwards (while others were fretting about inflation) and are ready to recover once people there get confident again. US rates may go as near as dammit to zero, and refinancing to reinvest will become the dominant US economic theme in 2009.
US first, then (possibly) UK to follow........... but I still see the pound lower before it (probably) recovers later.............
Nov 7th 2008, 5:57 am
#13
Not an evil hypnotist
Joined: May 2007
Posts: 1,975
Re: Bank of England cuts by 1.50 percent!!!!
And meanwhile, the pound is threatening 1.56 
