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Broad money figures prompt rate rise fears

Annual UK broad money growth at the end of 2006 shot up to 14% – the highest since 1990 – prompting fears of further interest rate rises to combat inflation.

Broad money is money in the public domain being spent with non-financial companies. The higher the broad money percentage, the cheaper money becomes and so inflation is created. The Bank of England combats this by raising the base rate.

In its December meeting, the BoE’s Monetary Policy Committee commented on broad money levels, which are the highest since 1990. Members discussed the prospect of inflation with some “placing weight on the risks of money growth” which “poses a risk of inflation”. This would signal further rate rises by the MPC in 2007.

Andrew Hagger, a member of’s expert panel created to make predictions, says: “There is no way around this situation so rate rises seem inevitable.”


Rise came to quick, says has warned that the surprise rate rise will mean that the housing market will not be able to cool gradually.The property website predicts that more severe changes will have to be made to the economy if the housing market is to remain stable.Warren Bright, chief executive of, says: Todays interest rate increase is […]

HSBC move sparks speculation over mortgage distribution

HSBC’s decision to distribute protection products via third party distributors has sparked speculation that it could soon embrace the intermediary market and make mortgage products available to brokers for the first time.

London house prices continue to soar

The Nationwide quarterly house price review has revealed that London house prices have continued to soar into 2007, with the average house costing nearly £270,000.The rise in the capital dwarfs any other national averages, with the national house price average being £172,065, a 9.3% annual change. London has seen a 11.3% rise, bringing the average […]

India budget: BJP focuses on growth

By Kunal Desai, Head of Indian Equities

With markets kept open on Saturday, finance minister Arun Jaitley delivered a promising budget focused on growth and decentralisation. While many complained about a six-day working week, there was much to be pleased about and the markets rallied in the afternoon to finish in the green.


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