Interest rate rise to 5.25%, the end may be in sight!
Last month I predicted a 0.25% increase in the base rate, which was based on inflation behaving better. That is exactly what has happened.
The voting
There was an entire committee of 9 for the vote. 6 voted to increase by 0.25% 2 votes to increase by 0.5% and 1 voted to maintain.
| Member | Direction | Amount |
|---|---|---|
| Andew Bailey (Governor) | increase | 0.25% |
| Ben Broadbent | increase | 0.25% |
| Jon Cunliffe | increase | 0.25% |
| Huw Pill | increase | 0.25% |
| Jonathan Haskel | increase | 0.5% |
| Catherine Mann | increase | 0.5% |
| Dave Ramsden | increase | 0.25% |
| Swati Dhingra | maintain | --- |
| Megan Greene | increase | 0.25% |
Outlook
The positive news previously reported is that inflation is trending down. CPIH Reduced from 7.9% in May to 7.3% in June. Whilst that is indeed positive there remains some uncertainty that it will continue hence a further increase in the base rate to 5.25%.
My prediction for the September MPC meeting is largely in line with my previous prediction. If inflation continues to fall in September then I expect rates to be held at least for one period. If there is any 'wobble' in inflation the the base rate may be increased again.
Lee Wisener, CeMAP, CeRER, CeFAP
Having worked in the mortgage industry for over 20 years I have always wanted to build a website dedicated to the subject. Also being a geek when it comes to the internet all I needed was time and I could both build the site from scratch and fill it with content. This is it!
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