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Boomed - UK inflation holds steady at 2.1%

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    Boomed - UK inflation holds steady at 2.1%

    UK inflation holds steady at 2.1%

    http://news.bbc.co.uk/1/hi/business/7149462.stm

    "UK inflation remained unchanged in November as lower utility bills offset higher petrol prices.

    Official figures showed the annual rate of CPI inflation was unchanged at 2.1% last month, just above the government's target of 2%.

    Observers say the data could give the Bank of England more opportunity to cut UK interest rates further.


    The RPI inflation measure, on which many pay deals are based, rose to 4.3% from 4.2% in October.

    The Bank of England's Monetary Policy Committee reduced interest rates to 5.5% from 5.75% earlier this month, with analysts predicting more cuts if the economy shows more signs of weakening.

    Cheaper vegetables

    The inflation rate remained steady despite the average price of unleaded petrol breaking through the £1-a-litre barrier
    on the back of higher oil costs.


    However, the size of gas and electricity bills continued to fall after 2006's large price increases.

    The Office for National Statistics said gas and electricity bills were falling at an annual rate of 5.6%, the steepest fall since records began.

    Analysts had expected food to have pushed inflation higher after a surge in the price of cakes and bread drove the annual rate of food inflation to a 14-year high in October.

    However, the ONS said that increases in the price of items such as bread and milk had been offset by falling vegetable prices.

    "November's lower than-expected inflation data keeps the door open for another interest rate cut early in 2008," said Howard Archer, chief UK economist at Global Insight.

    "Nevertheless, significant price risks persist and inflation still seems set to rise further over the coming months," he added.

    "Much will depend on to what extent economic activity appears to be slowing, whether or not pay moderation continues in the early 2008 wage rounds, and whether companies' pricing power appears to be waning."


    END


    Looks like Gordon's lining up a real terms pay cut for the little people (i.e. non-donors to the Labore Party).

    #2
    If inflation is 2.1% and target 2% - surely rates should rise?
    Last edited by BrilloPad; 18 December 2007, 12:27. Reason: Is/If typo

    Comment


      #3
      BoE = noddy

      BoE is a muppet. They are run by the Gov't, so much for independence. Bring back Eddie George, the ex-Governor, no degree or anything, just comon sense banker. Lots of professors from the LSE in the board that can't make up their minds what to do in a crisis (see NR), the hardest choice they face every day is which type of conrnflakes to have in the morning!
      You are right BP, the right thing to do is put interest rates up according to their criteria, but do they dare? Do they heck!

      Comment


        #4
        If all you fat gits stop eating all the cakes, then food inflation would stop going up even further and then the BoE could drop rates. Lower rates could provide an opportunity to save the economy. Hence fat people are the cause of the recession that will occur next year.

        Comment


          #5
          Originally posted by Dow Jones View Post
          BoE is a muppet. They are run by the Gov't, so much for independence. Bring back Eddie George, the ex-Governor, no degree or anything, just comon sense banker. Lots of professors from the LSE in the board that can't make up their minds what to do in a crisis (see NR), the hardest choice they face every day is which type of conrnflakes to have in the morning!
          You are right BP, the right thing to do is put interest rates up according to their criteria, but do they dare? Do they heck!
          dropping rates wont help anything now. its a confidence crisis. This could well be stagflation. Make great depression look like a stroll in the park.

          Comment


            #6
            Originally posted by TazMaN View Post
            If all you fat gits stop eating all the cakes, then food inflation would stop going up even further and then the BoE could drop rates. Lower rates could provide an opportunity to save the economy. Hence fat people are the cause of the recession that will occur next year.
            So what is the solution then? make them eat pies instead?

            Comment


              #7
              Originally posted by BrilloPad View Post
              So what is the solution then? make them eat pies instead?
              If they ate each other it would solve a lot of problems.

              Comment

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