Retail Sales Surge ensures another rate rise this year
Interest-Rates / UK Economy Sep 14, 2006 - 09:00 PM GMTBy: Sarah_Jones
High Street spending rose strongly in August, to 4.3% despite the August rate rise, which strongly increases the likelihood of another rate rise this year.
There are also signs that the china factor is coming to an end i.e. the price deflation that the high street has enjoyed for several years. Interest rates will now likely rise in November 2006 as the pressures on inflation remain in an economy running near full capacity.
How is this effect the markets ?Sterling will be boosted and is likely to rally in the coming sessions as traders adjust positions to take into account higher interest rates, the bond and stock markets as a whole will likely be weakened but there likely to be winners in the retail sector.
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