The Bank of England’s decision to cut UK interest rates to 5% this week was finely balanced but surely correct. The aim now should be to return rates to a 'neutral' level of around 4% early next year. The obvious starting point is that CPI inflation has now been at or very close to the … Continue reading Bank of England rate cut should be the first of many
Tag: ECB
Has the Bank of England missed the boat?
The global interest rate cutting cycle has begun, but there is little sign that the Bank of England is ready to jump on board. How much longer will the UK have to wait? This question became even more pressing last week when the European Central Bank (ECB) trimmed official rates in the euro area for … Continue reading Has the Bank of England missed the boat?
Bank of England edges towards a summer rate cut
The Monetary Policy Committee’s decision to leave interest rates on hold at 5.25% this week was unsurprising, but there were some welcome hints that cuts are coming soon. The market reaction was consistent with the slight dovish tilt: 2-5 year government bond yields fell about 5 basis points (these correlate closely with the cost of … Continue reading Bank of England edges towards a summer rate cut
End of free money brings the chickens home to roost
The shocks that occasionally batter the UK economy seem to be coming thicker and faster. The Global Financial Crisis (GFC) blew up in 2008. The Brexit vote followed eight year later. But we then only had to wait four years for Covid, and just two more for the cost-of-living crisis. At this rate we are … Continue reading End of free money brings the chickens home to roost
Plain-speaking Economics 