Have interest Rates in UK peaked already?

Recent increases in the interest rate suggest that there are more increases on the way. Inflation has reached 3% which is at the upper limit of the Banks CPI inflation target. Furthermore the UK housing market appears as buoyant as ever. House prices continue to rise to record levels (£137,000+) With this backdrop of rising inflation and rising inflation it suggests that interest rates may have to continue rising.

However on the other hand the Governor of the Bank of England has suggested that he expects inflation to fall sharply in the second half of this year. Much of last months increase in inflation is due to rising energy prices and tax. When these are taken away the inflationary situation doesn't appear quite so bad. If this is the case and if house prices start to slow down the need to increase interest rates will diminish significantly.

Labels: ,

0 Comments:

Post a Comment

Subscribe to Post Comments [Atom]

<< Home