Was the interest rate rise a wise move or mistake?
This is Money Podcast
This is Money
4.1 • 650 Ratings
🗓️ 3 August 2018
⏱️ 46 minutes
🧾️ Download transcript
Summary
Interest rates have finally risen above 0.5 per cent for the first time in almost a decade.
The Bank of England has decided that the UK's economy is healthy enough to finally get above the financial crisis emergency level, but was the hike a wise move or a mistake.
Of those in favour, some have been calling for a rate rise for a long time, others believe we must try to get back to normal before recession hits.
But those opposed believe even this tiny shift up to a very low base rate level of 0.75 per cent, is a gamble too far from the Monetary Policy Committee's ratesetters.
On this week's podcast, Simon Lambert, Lee Boyce and Georgie Frost dive into the rate rise.
Why did the bank hike rates, who will it affect, why do interest rates even move up and down and how did they end up at 0.5 per cent in the first place?
Also on this week's show, Lee introduces us to the world of micro-saving, we discuss the case of the financial adviser who suddenly ask for £10,000 more and Simon tries to show he is down with the kids who are making money by selling on Depop.
Transcript
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| 0:00.0 | Welcome to This Is Money podcast in partnership with NS&I. I'm your host, Georgie Frost, |
| 0:06.6 | and alongside editor Simon Lambert and I today is Consumer Affairs editor Lee Boyce. |
| 0:12.0 | And it's been a very long time coming, but the interest rate has gone above 0.5% for the first time in a decade. |
| 0:18.9 | The right move at the right time to wean the country |
| 0:22.3 | of its spending addiction and get some normality back to the economy or an ill-judged mistake |
| 0:29.2 | at a time when our economy is pretty weak and Brexit looms large. And what indeed will |
| 0:34.7 | a quarter point rise mean for us? Also today, Lee's uncovered more on |
| 0:38.6 | micro-fixing. What is it? And why would you bother? Financial advisors, how on earth can you work |
| 0:44.4 | out if they're value for money? And keeping it in the family, could you cope with being an |
| 0:49.1 | employee of your kid? Don't forget, you can start up to date. With all the latest breaking |
| 0:53.4 | money news, just go to this ismoney.com.uk or download the app. |
| 0:57.8 | This is Money, brought to you in partnership with NS&I, where safer savings set you free. |
| 1:03.8 | But first, for only the second time in a decade, interest rates have gone up. |
| 1:07.8 | The Bank of England increased the rate from 0.5% to 0.75%, immediately hitting |
| 1:13.3 | the 3.5 million people with variable or tracker mortgages who'll have to fork out a little more each |
| 1:19.3 | month. Now, in theory, the decision should be welcomed by savers, but don't get your hopes up. |
| 1:25.5 | Despite the vote being unanimous, though, business groups and debt charities |
| 1:28.7 | have all questioned the move after some weak economic data and fears over Brexit, indeed a no Brexit deal. |
| 1:35.3 | So was it the right decision? Why was it taken and what lies ahead of us? |
| 1:41.3 | So, not a surprise, Simon, but for you, now you've been calling for this, |
| 1:46.0 | haven't you, on this podcast, for a rate rise. You think that we were ready for it? I assume |
| 1:50.3 | you haven't changed your opinion. But with that in mind, just take us back, if you would. Why, |
... |
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