Comments: Grey big spender

Again, the housing market is devoid of supply and that works against the principle of rising interest rates having an effect on house prices. The house prices will keep on ballooning as long as supply is restricted.

The MPC is staying put so as to look closely at the GDP numbers which is part of their concern and in no hurry to hike up to 6% as yet....and rightfully so. It makes life a bit more difficult for them having to juggle between inflation and growth, especially in the case of the current market turmoil in sub-prime which is extending into hedge funds. This will probably have an impact in the UK funds and so far, we have not seen any fund owning upto to losses or future losses.

We have to keep our fingers crossed with what the next two months hold for GDP growth rates and hope that we grow with the trend so far.

Posted by Hitesh Damani at August 14, 2007 01:38 PM