As Reuters reported yesterday:
The Bank of England might wait until the middle of next year before cutting interest rates from their current 15-year high, the BoE's Chief Economist Huw Pill said on Monday.
Pill said pricing in financial markets - that currently points to a first rate cut to Bank Rate in August 2024 - "doesn't seem totally unreasonable, at least to me."
I have already noted government plans to autocratise the police and make them an instrument for party political gain this morning.
I suspect they have no need for such a plan in the case of the Bank of England: it seems likely that they voluntarily serve Tory party interests. It is hard to interpret this unnecessary comment in any other way, given that the timing would be perfect for a Tory pre-election boost.
I hate to be cynical, but sometimes you just have to be.
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When was the last time a BoE representative made a public statement predicting its interest rate nine months ahead?
Well, we can now predict an Autumn election. Of course if Pill is as reliable as the BoE’s general judgement, this comment will be confetti by the end of the week.
It doesn’t really matter, however because Britain has long been reduced to a polity sunk in the banality and triviality the media work so hard to ensure deflects the short attention span of a nation no longer capable of facing the real nature of its past, or its future.
Bring on the clowns.
Cynicism excused M,Lud.
Richard,
You do cynicism very well; intelligent and entertaining. Please proceed and carry on!
I suggested that very thing a few months ago on this website and you slapped me down!
Oh well, its your idea now.
It probably felt wrong then
And right now
When the facts change I change my mind
Sounds as though Sunak IS planning his Left Hook/Right Hook election strategy, even if for his successor
And what is the Left Hook/Right Hook strategy?
Left Hook = “You’ve broken every pledge & u-turned on every commitment, Sir Keir. Why should we believe a word you say?”
Right Hook- the Tories KNOW there’s a “magic money tree”, they’ve used it (think Furlough Scheme), so turn on the funding taps, to outbid Labour in policy terms, knowing Starmer is too scared to be bold and imagininative.
Lowering BoE interest rates fits the Right Hook very nicely.
And it’s highly likely Labour will have split to some degree over Starmer’s response to the Gaza situation, intensifying the Left Hook.
The Tories could actually scrape home under this scenario (especially under FPTP), perhaps only as a minority Government, but enough to keep Starmer our of No.10.
The Tories in the run-up to the 1997 election opened all their chests of financial goodies – in a much more malign economic environment – the economy was growing compared to now – and still ended up with a Labour win with a 179 majority.
Here’s hoping that whatever they do a big defeat awaits them.
Sorry – benign economic environment!
To be fair, I suspect BoE staff carefully craft any comments about the future to achieve the results they want with the foreign exchange markets, the other Central Banks and the Stock Exchange. I can’t imagine such comments have generally turned out to be accurate.
Except … there may be an interesting signal in that they are talking about the next move being downwards, when even a week ago they deliberately talked up the possibility of further rises.
The change is strange
Re your comment. “…… it seems likely that they voluntarily serve Tory party interests”
I assume the Labour government had to go to the IMF in 1976 because the Tory-supporting Bank of England refused to provide funding in order to cripple the government, using the ‘unaffordability’ tactic which has been the Tory excuse for the false, debilitating austerity policy dominating their politics since 2010? The B of E is just one of the powerful institutions from the Monarchy downwards which fundamentally support the Conservative cause. How many of these support Labour?