top of page
  • Writer's pictureEdgar Rayo

Finanze Daily Digest - 25/11/2022

The Brief: Interest rate cuts may be made at some point by the Bank of England, according to Sir Dave Ramsden. During his speech at the central bank’s "Watcher’s Conference" at King’s College London, the BoE deputy governor may reduce the Bank Rate should inflation “stop being a concern”. He is also less reliant on old economic models used in their forecasts. He added that most of Jeremy Hunt’s reforms will only begin after two years, so the Monetary Policy Committee’s (MPC) current projections do not yet reflect these proposed measures.

Why It Matters: The MPC remains focused on reducing inflation back to its target of 2%. Ramsden forecasts this could be achieved by the summer of 2024.

Finanze Foresights: Mortgage borrowers, particularly low-income households, have been hit hardest by high inflation and the energy price shock. Since the cost-of-living crisis is being compounded by falling real wages and a very tight labour market, our expectations for the coming months are in line with the BoE’s chief economist Huw Pill’s projections for more interest rate hikes. Preventing embedded inflation is important since the higher costs of goods and services devalue the pound, which translates to a weakening of sterling’s purchasing power. The more inflation rises, the more it influences mortgage costs. This means that those who will be borrowing to finance their home purchase or those who will refinance will have to face higher interest rates which in turn raise their monthly loan payments.


To the fullest extent permitted by law, Finanze Ltd are not responsible for any errors or omissions in any statements, views, opinions, facts, figures, commentary or any other material in the articles contained herein, or for loss arising from its use or performance, or for the results of any actions or lack of action taken on the basis of information provided in articles.

The topics covered in articles are complex and do not substitute the need for financial, legal, accounting, tax and other advice before making any decisions or taking any action based on information in articles.



Os comentários foram desativados.
bottom of page