Bank of England Rate cut to 315 yr low of 1.5%

[heganboy]

Northern and Ulster bank have already come out and stated they will be passing on the cut to tracke

They are obliged to "track" central bank rates with such mortgages. Anyone with such a mortgage is sucking diesel, but the bank is probably losing money on it!

you'd think so, but most of them have small print saying that we will only track if the rate remains above x% x usually around 2.5/ 3 sneaky feckers you couldn't be up to them...

[bennydorano]

When rates are cut does this weaken the currency?

As Delboy said generally yes. This is because wealthy investors may be able get better rates elsewhere. For example if the US is at 0% and the Eurozone is at 5% any international money will go to the higher rate and move out of the lower currency. The sell off usually weakens the currency with the lower rate and raises the one with the higher rate.

The reason we are seeing exceptions these days is that all rates are changing quickly and investors are anticipating rate cuts.   

O.k  i have to buy some sterling but don't need it in a hury.  Would it be advisable to hold off for a bit or buy now.

I'm no economist but I would say buy now, with the Eurozone widely expected to cut rates next week the Euro is near certain to weaken against Sterling.  Also, I would always use a cash machine when getting a different currency where you get the official rate  - tourist rates, i.e when cash is changed by a teller in a bank, are always worse as is the Post office(UK) whenever commission is involved.

[cavan4ever]

When rates are cut does this weaken the currency?

As Delboy said generally yes. This is because wealthy investors may be able get better rates elsewhere. For example if the US is at 0% and the Eurozone is at 5% any international money will go to the higher rate and move out of the lower currency. The sell off usually weakens the currency with the lower rate and raises the one with the higher rate.

The reason we are seeing exceptions these days is that all rates are changing quickly and investors are anticipating rate cuts.   

O.k  i have to buy some sterling but don't need it in a hury.  Would it be advisable to hold off for a bit or buy now.

I'm no economist but I would say buy now, with the Eurozone widely expected to cut rates next week the Euro is near certain to weaken against Sterling.  Also, I would always use a cash machine when getting a different currency where you get the official rate  - tourist rates, i.e when cash is changed by a teller in a bank, are always worse as is the Post office(UK) whenever commission is involved.

i don't need it till March but i will be in Enniskellen this wkend so i will get a bit now anyway.

[muppet]

http://blogs.telegraph.co.uk/eamonn_butler/blog/2009/01/08/printing_money_wont_cure_britains_economic_ills

Rumours that Brown is considering printing more money would be a cause for concern. That would certainly drive down Sterling versus other currencies.

Only the Fed can do this without negative effects. That is because oil is traded in dollars. Ach sin scéal eile...

[Bensars]

Well i would think that for the majority of the board,

there are more savers than mortgage holders in society, is Gaaboard different? Why should the thrifty lose their reward?

Firstly i would say that the average age profile for this board would be between 20-40. IMO most people within this age profile would have a mortgage.

Secondly, anyone that was thrifty is not losing their reward. They are still being rewarded but not to the same degree.

Northern and Ulster bank have already come out and stated they will be passing on the cut to tracke

They are obliged to "track" central bank rates with such mortgages. Anyone with such a mortgage is sucking diesel, but the bank is probably losing money on it!

Wrong, they are not obliged to track BOE rate. Some banks trackers have "floors" whereby the rate can drop in line with BOE rates but only to certain levels. Thankfully this  "flooring" does not apply to myself and i will find a reduction in my monthly payment.

[bennydorano]

http://blogs.telegraph.co.uk/eamonn_butler/blog/2009/01/08/printing_money_wont_cure_britains_economic_ills

Rumours that Brown is considering printing more money would be a cause for concern. That would certainly drive down Sterling versus other currencies.

Only the Fed can do this without negative effects. That is because oil is traded in dollars. Ach sin scéal eile...

Alastair Darling has categorically denied that this will happen, but that in itself will hardly calm the markets.  Expect a concerted push of negativity from the likes of the Telegraph with a UK general election on the horizon.