Consumer Price Inflation Hits 11.1%, a 40 Year High

The ONS this morning reports that the Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 9.6% in the 12 months to October 2022, up from 8.8% in September. CPI rose by 11.1%, up from 10.1%. These increases were driven by gas and electricity prices and have caused CPI to hit a 40-year high.

mdi-timer 16 November 2022 @ 07:23 16 Nov 2022 @ 07:23 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Bank of England Predicts Two-Year Recession, Unemployment Forecast to Nearly Double

Aside from the breaking news about the massive interest rate rise, the Bank of England’s report today makes for grim reading. The Monetary Policy Committee (MPC) projects a “prolonged period” of recession, with CPI inflation remaining over 10% in the near term. Even taking into account that economic predictions are about as reliable as a long-term weather forecast, the report makes for truly grim reading…

While inflation is expected to fall “sharply” from mid-2023, GDP is expected to decline by around 0.75% during the second half of 2022, and continue to fall throughout 2023 and the first half of 2024. The BBC says this would be the longest recession since records began in the 1920s, albeit not the deepest…

Perhaps most worrying of all for the government, the MPC expects the unemployment rate to rise to just under 6.5% by Q4 of 2025, up from the current 2022 Q4 projection of 3.7%. In real terms this would leave an extra million working brits on the dole. Perfect timing – right around the last possible election date…

mdi-timer 3 November 2022 @ 12:51 3 Nov 2022 @ 12:51 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Bank of England Raises Interest Rates 0.5% to 2.25%

The Bank of England has raised interest rates by 0.5%, bringing rates to a 14-year high of 2.25%. Inflation is now expected to peak at 11% – down from 13% –following the government’s energy bailout. Although the Bank expects it to stay in double digits for several months…

mdi-timer 22 September 2022 @ 12:10 22 Sep 2022 @ 12:10 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Inflation Hits 10.1% in 12 Months to July

CEBR analysis:

According to a data release from the Office for National Statistics (ONS) this morning, UK inflation stood at 10.1% in July, as measured by the Consumer Prices Index (CPI). This marked an acceleration from June’s rate of 9.4% and the highest reading since that of 10.2% recorded in February 1982, over 40 years ago. On a monthly basis, prices rose by 0.6% in July, down from 0.8% in June and the lowest monthly change since January. Meanwhile, the Consumer Prices Index including owner occupiers’ housing costs (CPIH) recorded 8.8% annual inflation in July, marking an uptick from 8.2% in June.

mdi-timer 17 August 2022 @ 07:33 17 Aug 2022 @ 07:33 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Braverman: “Interest Rates Should Have Been Raised a Long Time Ago”

With the Bank of England expected to whack up interest rates to 1.75% this lunchtime, Team Truss is hitting the airwaves to attack them for being “too slow” in acting to curb inflation. Appearing on Sky News this morning, Suella Braverman tore into the BofE for failing to move quicker:

“Interest rates should have been raised a long time ago and the Bank of England has been too slow in this regard… The challenge that we’re facing at the moment is the fight against global inflation. Raising interest rates is a lever that the Bank of England has in that fight, reducing public spending is another, and cutting taxes so that families and businesses can grow their way out of the challenges is a very important step forward.”

Truss herself is promising to review the mandate of the central bank for the first time since 1997 to “make sure in the future it matches some of the most effective central banks in the world at controlling inflation”. In the meantime, stay tuned at 12:30 for the Bank’s latest announcement. Brace yourselves…

mdi-timer 4 August 2022 @ 09:03 4 Aug 2022 @ 09:03 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
Real Terms Pay Falling at Fastest Rate in 20 Years

Inflation is continuing to eat into people’s incomes, with pay excluding bonuses now down by 2.8% in real terms compared to a year ago. The biggest fall since records began…

According to the Office for National Statistics (ONS), pay including bonuses has also now fallen by 0.9% since last year, even accounting for total pay growth of 7.2% in the private sector across the same period. There is some good news: unemployment is still at record lows, and continues to fall. It’s now at 3.8% – lower than pre-pandemic levels – and vacancies were up by 6,900 compared to the last quarter.
Chancellor Nadhim Zahawi said:

“[These figures] underline how strong our jobs market continues to be… I am acutely aware that rising prices are affecting how far people’s hard-earned income goes, so we are providing help for households through cash grants and tax cuts.”

Not sure what “tax cuts” he means, though…

mdi-timer 19 July 2022 @ 08:42 19 Jul 2022 @ 08:42 mdi-twitter mdi-facebook mdi-whatsapp mdi-telegram mdi-linkedin mdi-email mdi-comment View Comments
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