Tag: Bank of England

ARMs Will Drag Great Britain and The U.S.

ARMs Will Drag Great Britain and The U.S.

Approximately 1.2 million residential mortgages in Great Britain are adjustable rate mortgages (ARMs). As the Bank of England (BOE), continues to move interest rates higher (3% rate today and likely moving to 3.5% on December 15th), the average ARM holder will have to absorb significantly higher monthly payments which translates to commensurately less disposable income. … Continue reading ARMs Will Drag Great Britain and The U.S.

The U.K., The U.S., Inflation & Real Yields

The U.K., The U.S., Inflation & Real Yields

The Bank of England stepped into the bond market, agreeing to purchase Government long bonds until October 14th. The BoE plans to restart its Government bond sale program on October 31st (the central bank plans to sell GBP 80 billion of bonds each year as part of its tightening process). How did the U.K. find … Continue reading The U.K., The U.S., Inflation & Real Yields

The U.K. Is Not In An Enviable Position

The U.K. Is Not In An Enviable Position

The Bank of England will likely institute an emergency rate hike of 25-50 BPS today in our opinion as the Pound plummets against the USD (FX Headwinds Will Persist Into 2023). What is fascinating is that the fiscal side loosened policy last week as U.K. Prime Minister Liz Truss pushed tax cuts. Conversely, the monetary … Continue reading The U.K. Is Not In An Enviable Position