Finally A Rate Cut, Though Weirdly Into A Growing Economy!

As expected, the Bank of England finally cut the base rate by 0.25%, to 5%, the first cut in four and a half years though it was a finely balanced decision which reflected increased confidence that the worst inflation shock in decades, was easing. The Bank of England governor, Andrew Bailey, said inflationary pressures had “eased enough” to enable the first cut since the Bank stopped ramping up borrowing costs this time last year.
The MPC was split by five votes to four, exposing divisions within the central bank’s most senior ranks, with Bailey casting the deciding vote for a quarter-point reduction.
Households which saw borrowing costs rise to the highest level since the 2008 financial crisis can look to lower mortgage rates, though the bulk remain on high fixed rates for now. But Bailey said savers and borrowers should not expect large reductions over the coming months, amid concerns about lingering risks to the economy. “We need to make sure inflation stays low, and be careful not to cut interest rates too quickly or by too much,” he said. “Ensuring low and stable inflation is the best thing we can do to support economic growth and the prosperity of the country.”
Remember that Prices remain significantly higher than three years ago and are still rising despite Inflation falling back to the 2% government target in May. The Bank remains concerned over stubborn price increases in the service sector of the economy and resilience in wage growth.
So, while the Bank of England did cut, the UK economy is not out of the woods yet, and we should expect a tick up in inflation ahead, so the next few months data will still be important. And taxes of course, will continue to grind higher.
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[@robstone4537]

Australia started raising rates too late and as a result it weakened the AUD. The RBA needs to hold a while before cutting to let the AuD rise.

[@shugdee]

Yep, for least 12 months. But there’s too many vested interests in the property ponzi scheme that we pretend is a productive economy 😂😂😂

[@davidbrayshaw3529]

@@shugdee The RBA won't give two hoots about the property market. They'll be far more worried about maintaining the dollar courtesy of our debt levels.

[@shugdee]

If there’s one economy with very little hope, it’s the U.K.

[@brucewayne3633]

Appears there are many baked-in price rises... and an expanding bureaucracy to take care of the expanding bureaucracy...

[@jameswillis8969]

Inflation hasn’t eased at all, they know high rates are to blame

[@Ben-zv7ph]

Last week chicken thighs $11 a kilo this week $14.50 Woolworths.

[@Ben-zv7ph]

Last week chicken thighs were $11 and this week $14.50 at wool worths. Not sure why this comment was deleted.

[@grizzz6884]

@10.26 . they keeping talking about covid and brexit as the problem . but the graph shows most of the debt was created from 2008 to 2017 .
in sep 17 2019 trump bailed repo market out and the debt took of again .
so maybe we should try another way , as doing the same thing hoping for a different out come is nuts .

[@doodlegassum6959]

Kicking the can down the road again

[@richarddobosz6174]

Excellent thank you compulsory listening

[@WalkTheWorldDFA]

Thanks for listening

[@grizzz6884]

@9.20 . with all the online transactions how can they not have all the data , they know what is what . just wont tell the people

[@geraldtonmint]

The beginning of the rate cut cycle

[@strategicviewpoint6672]

Higher inflation for at least the rest of the decade. There may be peaks and valleys but overall trend upwards. Rate cut cycle would just aggravate the situation

[@cathyabrahamse1929]

Its about time,for months meeting after meeting i hope it happens sooner than much later.

[@geraldtonmint]

@@strategicviewpoint6672 government loves inflation and is scared to death of deflation. Economies worldwide are in recession and the only thing they can do is inflate

[@johndoh6198]

I would hardly call GDP growth bouncing along 0 as a growing economy 🤣. Not to mention it is artificially stimulated growth through immigration.