You are here: Home - News -

Early interest rate rise less likely after Budget

  • 25/03/2011
  • 0
In an exclusive Mortgage Solutions TV panel debate, industry experts agreed a May rate rise is less likely following the Budget and the unchanged voting pattern revealed by the Monetary Policy Committee.

AMI director Robert Sinclair, Tenet Lime managing director Gemma Harle and Private Finance director Melanie Bien agreed the MPC Minutes the morning of the Budget and the Chancellor’s prediction inflation would remain up at between 4 to 5% this year make a rise within the next two months less likely.

Sinclair said the Office for Budget Responsibility’s (OBR) revised projections for GDP growth for 2011-12 down to 1.7% from 2.1% meant tax take will also be lower than hoped.

“As such, any rate rises could stifle the economy and are less likely to happen because any stop on the economy could increase the danger of a double dip, which would be catastrophic,” said Sinclair.

“That’s the real juggling act that follows now,” he added.

Harle agreed, adding: “Hopes of a rate rise are largely wishful thinking on the broker front.”

Bien predicted the first rate move in “September at the earliest.”

Robert Sinclair suggested there might be a vague chance of a move in July, but agreed with Bien September was more likely and then probably just 0.25% basis points.

Bien said: “Because we’ve had it so low for so long, rates won’t need to rise by much to have an impact. Actually, just by starting to rise, rates should affect the market.”

There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.


Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.


Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.


Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
Read previous post:
Brain & TrigoldCrystal deal killed by contract

The proposed Mortgage Brain and TrigoldCrystal merger was unlikely to ever happen for contractual reasons, confirmed Trigold yesterday.