Interest rates

nelly55

Member
Location
Yorkshire
If the cost of borrowing money rises, consumers and businesses have less money to spend. As demand falls economic growth slows down and in theory so should the prices of goods and services. Increasing the Bank rate is like a lever for slowing down inflation.
Just copied the above,
If energy and everything we need in our daily lives continues to increase how can we sell cheaper.
Is it just me who thinks using interest rates to cut inflation is going to cause more trouble
 

glasshouse

Member
Location
lothians
If the cost of borrowing money rises, consumers and businesses have less money to spend. As demand falls economic growth slows down and in theory so should the prices of goods and services. Increasing the Bank rate is like a lever for slowing down inflation.
Just copied the above,
If energy and everything we need in our daily lives continues to increase how can we sell cheaper.
Is it just me who thinks using interest rates to cut inflation is going to cause more trouble
Raising interest rates causes recessions
 

Poorbuthappy

Member
Livestock Farmer
Location
Devon
If the cost of borrowing money rises, consumers and businesses have less money to spend. As demand falls economic growth slows down and in theory so should the prices of goods and services. Increasing the Bank rate is like a lever for slowing down inflation.
Just copied the above,
If energy and everything we need in our daily lives continues to increase how can we sell cheaper.
Is it just me who thinks using interest rates to cut inflation is going to cause more trouble
Have said this several times lately. "It's not that type of inflation ".
Interest rate rises to curb spending and bring down inflation. Except the inflation is on essentials - food, fuel and energy. All it will do is push more into poverty.
 

redsloe

Member
Location
Cornwall
I don't know where the BoE are going with this. Inflation is being caused by essentials, ie food and power, so raising interest rates won't slow that down to much effect as we all need them.
I really think they are a one trick pony and subsequently useless in today's world.

Edit; fat fingers=slow🤣
 

Yale

Member
Livestock Farmer
So you increase finance costs for farmers,some of whom are highly geared and maybe up to their limits due to cash flow and input prices.

Result weakens farms and food production.

This is without the effect on supply chain issues for food processors and an extra squeeze on pubs and restaurants.

Maybe the BOE have their reasons however it is not without consequences.
 
If the cost of borrowing money rises, consumers and businesses have less money to spend. As demand falls economic growth slows down and in theory so should the prices of goods and services. Increasing the Bank rate is like a lever for slowing down inflation.
Just copied the above,
If energy and everything we need in our daily lives continues to increase how can we sell cheaper.
Is it just me who thinks using interest rates to cut inflation is going to cause more trouble

They have not raised interest rates anything like enough for people to notice yet.

At 6-7 or 8% things would get interesting very quickly I would suggest.

I bet we don't see a 5% base rate for the next 10 years at least. Rates like that would cripple a lot of households, never mind businesses.
 

pellow

Member
Location
Newquay
Fair enough if you think the current inflation will not be arrested by interest rates, we are in a situation where you can buy anything and it will have increased in price in 12 months time, they need to put a price on that to stop it getting out of hand
 
Start to look out for redundancies and lay offs, that'll be the first sign of the canary in the coal mine, once that starts setting in the economy will soon start to catch cold and its a vicious spiral downward then.

I can't see it. Everywhere I look the economy is running flat out and growth is constrained by a shortage of labour more than anything else. Every tradesman in the locality I have spoken to is saying they are stacked out with work and can't take on any more. I would say houses are not changing hands as fast as they were but there is a shortage of properties in many areas and often houses are viewed a million times within days of coming on the market. You look around and boom they are sold in a wink.

I spend my breaktimes watching the world go by and the rate at which money is changing hands is off the scale, McD's, Costa, diesel, spend spend spend and work work work. I'd say the economy is grinding on pretty well.
 
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Fair enough if you think the current inflation will not be arrested by interest rates, we are in a situation where you can buy anything and it will have increased in price in 12 months time, they need to put a price on that to stop it getting out of hand

Costs have risen so businesses are passing these on to the consumer. It's not inflation, it's cost. The government just made red diesel a non-thing for construction, basically another stealth tax, and surprise surprise everything has become more expensive?
 

DrWazzock

Member
Arable Farmer
Location
Lincolnshire
If the cost of borrowing money rises, consumers and businesses have less money to spend. As demand falls economic growth slows down and in theory so should the prices of goods and services. Increasing the Bank rate is like a lever for slowing down inflation.
Just copied the above,
If energy and everything we need in our daily lives continues to increase how can we sell cheaper.
Is it just me who thinks using interest rates to cut inflation is going to cause more trouble
I agree. Inflation isn’t being driven because people are spending and borrowing too much, it’s being driven by input cost inflation due to scarcity of supply that can’t even keep up with normal demand, never mind luxury spending.
Raising rates to suppress even this normal demand to reduce input requirements to alleviate input price inflation is a recipe for a depression never mind a recession in my view. Interesting times ahead.
 

topground

Member
Livestock Farmer
Location
North Somerset.
Start to look out for redundancies and lay offs, that'll be the first sign of the canary in the coal mine, once that starts setting in the economy will soon start to catch cold and its a vicious spiral downward then.
History shows that when the coffee shops in the High Street close you know there is a proper recession in place. If folk don’t have spare cash to spend on tea and cakes these businesses are vulnerable.
 

ffukedfarmer

Member
Mixed Farmer
Location
West Kent
I agree. Inflation isn’t being driven because people are spending and borrowing too much, it’s being driven by input cost inflation due to scarcity of supply that can’t even keep up with normal demand, never mind luxury spending.
Raising rates to suppress even this normal demand to reduce input requirements to alleviate input price inflation is a recipe for a depression never mind a recession in my view. Interesting times ahead.

I doesn't make any sense to me either. The rate rise will hurt consumers and businesses at a time when they are already feeling the pinch from energy, food, labour cost increases etc. Why add to it?
 

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HSENI names new farm safety champions

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Written by William Kellett from Agriland

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The Health and Safety Executive for Northern Ireland (HSENI) alongside the Farm Safety Partnership (FSP), has named new farm safety champions and commended the outstanding work on farm safety that has been carried out in the farming community in the last 20 years.

Two of these champions are Malcom Downey, retired principal inspector for the Agri/Food team in HSENI and Harry Sinclair, current chair of the Farm Safety Partnership and former president of the Ulster Farmers’ Union (UFU).

Improving farm safety is the key aim of HSENI’s and the FSP’s work and...
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