THE GUARDIAN: Andrew Bailey also said disastrous mini-budget had damaged Britain’s international reputation
Britain is suffering worse economic performance than its rivals because of Brexit and a stark drop in the size of the workforce since the Covid pandemic, the governor of the Bank of England has said.
Andrew Bailey said a combination of headwinds had prevented the economy from recovering to pre-pandemic levels, while warning it would also take time for the government to repair damage to Britain’s international reputation caused by the disastrous mini-budget under the former prime minister Liz Truss.
It came as rampant inflation of 11.1% – the highest figure since October 1981 – piled more pressure on the Bank to continue raising interest rates.
In a downbeat assessment on the eve of the chancellor’s autumn statement, the Bank’s governor told MPs on the Commons Treasury committee: “I’m afraid it’s not a good story.” » | Richard Partington, Economics correspondent | Wednesday, November 16, 2022
Showing posts with label inflation. Show all posts
Showing posts with label inflation. Show all posts
Wednesday, November 16, 2022
UK Inflation Jumps to 11.1% on Back of Energy and Food Price Rises
THE GUARDIAN: Rishi Sunak vows to prioritise fight against the rising cost of living
Rishi Sunak has pledged to make the fight against a rising cost of living his No 1 priority after surging energy bills sent the UK’s annual inflation rate to a 41-year-high of 11.1%.
Preparing the ground for tough action in Thursday’s autumn statement, the prime minister responded to the highest figure since October 1981 by describing inflation as an “enemy” that needed to be faced down.
Data from the Office for National Statistics (ONS) showed the annual inflation rate last month jumped a percentage point from 10.1% in September, despite help provided to households through the launch of the government’s energy price guarantee.
Dearer food also contributed to prices rising 2% in October alone compared with the previous month, a bigger increase than the Bank of England and the City had been anticipating. Milk, cheese and egg prices rose by more than 27% compared with a year earlier. » | Larry Elliott, Economics editor | Wednesday, November 6, 2022
Rishi Sunak has pledged to make the fight against a rising cost of living his No 1 priority after surging energy bills sent the UK’s annual inflation rate to a 41-year-high of 11.1%.
Preparing the ground for tough action in Thursday’s autumn statement, the prime minister responded to the highest figure since October 1981 by describing inflation as an “enemy” that needed to be faced down.
Data from the Office for National Statistics (ONS) showed the annual inflation rate last month jumped a percentage point from 10.1% in September, despite help provided to households through the launch of the government’s energy price guarantee.
Dearer food also contributed to prices rising 2% in October alone compared with the previous month, a bigger increase than the Bank of England and the City had been anticipating. Milk, cheese and egg prices rose by more than 27% compared with a year earlier. » | Larry Elliott, Economics editor | Wednesday, November 6, 2022
Friday, October 28, 2022
En France, la croissance ralentit, l’inflation s’envole
LE MONDE : L’économie française a ralenti au troisième trimestre, la hausse du PIB se limitant à 0,2 %.
A l’image de la météo quasi estivale pour une fin octobre, l’économie française, pourtant handicapée par des prix qui continuent de flamber, refuse d’entrer dans l’hiver. Selon les données publiées, vendredi 28 octobre, par l’Insee, l’activité au troisième trimestre a bien marqué le pas, avec un produit intérieur brut (PIB) en hausse de 0,2 %, après 0,5 % au trimestre précédent, mais elle reste positive. Pour 2022, l’acquis de croissance s’établissait donc à 2,5 % à fin septembre, un chiffre légèrement en retrait par rapport aux prévisions de l’exécutif, de 2,7 %. » | Par Béatrice Madeline | vendredi 28 octobre 2022
Article réservé aux abonnés
A l’image de la météo quasi estivale pour une fin octobre, l’économie française, pourtant handicapée par des prix qui continuent de flamber, refuse d’entrer dans l’hiver. Selon les données publiées, vendredi 28 octobre, par l’Insee, l’activité au troisième trimestre a bien marqué le pas, avec un produit intérieur brut (PIB) en hausse de 0,2 %, après 0,5 % au trimestre précédent, mais elle reste positive. Pour 2022, l’acquis de croissance s’établissait donc à 2,5 % à fin septembre, un chiffre légèrement en retrait par rapport aux prévisions de l’exécutif, de 2,7 %. » | Par Béatrice Madeline | vendredi 28 octobre 2022
Article réservé aux abonnés
Wednesday, October 26, 2022
Rishi Sunak Refuses to Commit to Inflation-proofing Benefits
MARK ALEXANDER: If this country cannot afford to raise benefits for the poor in line with inflation, especially in these highly inflationary times, then one must conclude that this country cannot afford the luxury and extravagance of a monarchy. This is a logical and necessary conclusion. The people must come first, not the extravagance of monarchy.
Rishi Sunak had better be very careful what he decides. These are very difficult times for so many people. It cannot be taken for granted that the people will plump for monarchy over being able to feed their children and keep themselves and their families warm over winter.
I should like to remind Mr. Sunak that this is exactly how, historically, monarchies have been overthrown. Think 1789! The French Revolution!
When people cannot feed their children, and when people cannot keep themselves and their families warm during winter, anything can happen. Be very, very careful, Mr. Sunak!
Mark Alexander
All Rights Reserved
Rishi Sunak had better be very careful what he decides. These are very difficult times for so many people. It cannot be taken for granted that the people will plump for monarchy over being able to feed their children and keep themselves and their families warm over winter.
I should like to remind Mr. Sunak that this is exactly how, historically, monarchies have been overthrown. Think 1789! The French Revolution!
When people cannot feed their children, and when people cannot keep themselves and their families warm during winter, anything can happen. Be very, very careful, Mr. Sunak!
Mark Alexander
All Rights Reserved
Saturday, October 15, 2022
Friday, October 14, 2022
Wednesday, October 12, 2022
Bread for the People I ARTE.tv Documentary
For months Turkey has been in the grip of a monetary crisis coupled with rampant inflation. The price of bread, by far the most important staple food in the country, has doubled in a year. Even the middle class is now finding it increasingly difficult to get by.
Bread for the People | ARTE.tv Documentary
Available until the 05/09/2023
Diese Doku ist hier auf Deutsch verfügbar.
Bread for the People | ARTE.tv Documentary
Available until the 05/09/2023
Diese Doku ist hier auf Deutsch verfügbar.
Friday, October 07, 2022
Global Fallout from Rate Moves Won’t Stop the Fed
THE NEW YORK TIMES: The Federal Reserve, like many central banks, sets policy with an eye on the domestic economy. Its battle to control prices is causing pain abroad.
The Federal Reserve has embarked on an aggressive campaign to raise interest rates as it tries to tame the most rapid inflation in decades, an effort the central bank sees as necessary to restore price stability in the United States.
But what the Fed does at home reverberates across the globe, and its actions are raising the risks of a global recession while causing economic and financial pain in many developing countries.
Other central banks in advanced economies, from Australia to the eurozone, are also lifting rates rapidly to fight their inflation. And as the Fed’s higher interest rates attract money to the United States — pumping up the value of the dollar — emerging-market economies are being forced to raise their own borrowing costs to try to stabilize their currencies to the extent possible.
Altogether, it is a worldwide push toward more expensive money unlike anything seen before in the 21st century, one that is likely to have serious ramifications. » | Jeanna Smialek and Alan Rappeport | Friday, October 7, 2022
The Federal Reserve has embarked on an aggressive campaign to raise interest rates as it tries to tame the most rapid inflation in decades, an effort the central bank sees as necessary to restore price stability in the United States.
But what the Fed does at home reverberates across the globe, and its actions are raising the risks of a global recession while causing economic and financial pain in many developing countries.
Other central banks in advanced economies, from Australia to the eurozone, are also lifting rates rapidly to fight their inflation. And as the Fed’s higher interest rates attract money to the United States — pumping up the value of the dollar — emerging-market economies are being forced to raise their own borrowing costs to try to stabilize their currencies to the extent possible.
Altogether, it is a worldwide push toward more expensive money unlike anything seen before in the 21st century, one that is likely to have serious ramifications. » | Jeanna Smialek and Alan Rappeport | Friday, October 7, 2022
Tuesday, October 04, 2022
Liz Truss Refuses to Rule Out Real-terms Benefits Cuts
THE GUARDIAN: PM facing fresh battle with MPs as she declines to commit to raising benefits in line with inflation
Liz Truss said ministers were ‘going to have to make decisions about how we bring down debt as a proportion of GDP in the medium term’. Photograph: Hannah McKay/Reuters
Liz Truss has refused to commit to raising benefits in line with inflation, amid a fresh battle with MPs over cuts to spending including concern from among her cabinet.
The prime minister said pensions would rise in line with inflation, having committed to the pensions “triple lock” during the leadership campaign. But she said people on welfare benefits were in a “different situation” and said they were more able to look for more work.
“When people are on a fixed income, when they are pensioners, it is quite hard to adjust. I think it’s a different situation for people who are in the position to be able to work,” she told LBC. “What I want to do is make sure that we are helping more people into work.” » | Jessica Elgot, Deputy political editor | Tuesday, October 4, 2022
Please remind me: Did the Devil ever have a daughter? If he did, this must be she! God is replete with compassion; the Devil, by contrast, has none. Just like Lizzie! She has absolutely no compassion for the less fortunate and worries about the pennies they might be costing the country; by contrast, she is generosity itself when it comes to the superrich and doesn't give a damn that many are not paying any taxes at all and are hiding their great fortunes from the taxman by stashing the dosh away offshore. – © Mark Alexander
Liz Truss has refused to commit to raising benefits in line with inflation, amid a fresh battle with MPs over cuts to spending including concern from among her cabinet.
The prime minister said pensions would rise in line with inflation, having committed to the pensions “triple lock” during the leadership campaign. But she said people on welfare benefits were in a “different situation” and said they were more able to look for more work.
“When people are on a fixed income, when they are pensioners, it is quite hard to adjust. I think it’s a different situation for people who are in the position to be able to work,” she told LBC. “What I want to do is make sure that we are helping more people into work.” » | Jessica Elgot, Deputy political editor | Tuesday, October 4, 2022
Please remind me: Did the Devil ever have a daughter? If he did, this must be she! God is replete with compassion; the Devil, by contrast, has none. Just like Lizzie! She has absolutely no compassion for the less fortunate and worries about the pennies they might be costing the country; by contrast, she is generosity itself when it comes to the superrich and doesn't give a damn that many are not paying any taxes at all and are hiding their great fortunes from the taxman by stashing the dosh away offshore. – © Mark Alexander
Monday, October 03, 2022
Turkey Inflation at New 24-year High of 83% after Rate Cuts | DW News
Inflation in Turkey climbed to a new 24-year high of 83.45% in September, according to official data, after the central bank surprised markets by cutting rates twice in the last two months.
Turkey's repeated reductions in rates come at the insistence of President Recep Tayyip Erdogan, who believes — contrary to well-established economic principles — that reducing interest rates can slow inflation, rather than fuel it.
Turkey's repeated reductions in rates come at the insistence of President Recep Tayyip Erdogan, who believes — contrary to well-established economic principles — that reducing interest rates can slow inflation, rather than fuel it.
Friday, September 30, 2022
Failure to Raise Benefits Would Be ‘Hostile and Harmful’, Truss Is Warned
THE GUARDIAN: PM reneging on Conservative promise to increase benefits in line with inflation ‘morally indefensible’, say experts
Liz Truss will deliver the biggest permanent real-terms cut to the basic rate of benefits ever made if she fails to raise them in line with inflation, one of the UK’s leading poverty charities has said.
The Joseph Rowntree Foundation (JRF) urged the government not to renege on its promise, made earlier this year, to raise universal credit and other working age benefits in line with inflation. It said such a move would be a “harmful act of historic proportions” – and deliver a devastating blow to millions of families on low incomes.
The JRF’s intervention follows widespread outrage at suggestions that the Treasury will seek to strip billions of pounds from the welfare budget to help repair shattered government finances after its disastrous mini-budget last week, which announced generous tax breaks for the rich but caused a near financial crisis. » | Patrick Butler Social policy editor| Friday, September 30, 2022
If this heartless woman reneges on Tory promises, she will be nothing less than evil. Very many struggling families rely on those benefits just to survive. This is an outrage. – © Mark Alexander
Liz Truss will deliver the biggest permanent real-terms cut to the basic rate of benefits ever made if she fails to raise them in line with inflation, one of the UK’s leading poverty charities has said.
The Joseph Rowntree Foundation (JRF) urged the government not to renege on its promise, made earlier this year, to raise universal credit and other working age benefits in line with inflation. It said such a move would be a “harmful act of historic proportions” – and deliver a devastating blow to millions of families on low incomes.
The JRF’s intervention follows widespread outrage at suggestions that the Treasury will seek to strip billions of pounds from the welfare budget to help repair shattered government finances after its disastrous mini-budget last week, which announced generous tax breaks for the rich but caused a near financial crisis. » | Patrick Butler Social policy editor| Friday, September 30, 2022
If this heartless woman reneges on Tory promises, she will be nothing less than evil. Very many struggling families rely on those benefits just to survive. This is an outrage. – © Mark Alexander
Thursday, September 29, 2022
L’inflation alimentaire en France s’approche des 10 % dans les supermarchés
LE MONDE : Certains produits de première nécessité, comme les pâtes ou le riz, se sont envolés de 20, 30, voire 130 % sur un an. Et le rythme ne ralentit pas.
« L’invitée surprise. » C’est ainsi que Jean-Philippe André, président de l’Association nationale des industries agroalimentaires (ANIA) qualifie l’inflation. Il se remémore, qu’il y a un an à peine, le sujet n’était même pas abordé. Depuis, la valse des étiquettes s’est enclenchée dans les rayons des supermarchés. Et le rythme ne ralentit pas. Après avoir franchi la barre des 5 % en juin, l’inflation alimentaire s’approche désormais du seuil des 10 %.
C’est le constat dressé par le cabinet d’analyses IRI France, qui publiait, jeudi 29 septembre, les données collectées à la fin de ce mois. Cette société qui scrute les achats des consommateurs après leur passage en caisse avait enregistré un premier frémissement des prix à la hausse, en décembre 2021.
Neuf mois plus tard, elle constate que les prix des produits de grande consommation ont bondi, en un an, de 9,11 %. Sur les seuls produits alimentaires, la progression est de 9,75 %. IRI France pointe les rayons épicerie salée, crémerie, surgelés et glaces, où les hausses de tarifs dépassent les 10 %. Avec une mention spéciale pour les viandes surgelées dont l’inflation frôle les 30 %. Seuls les apéritifs anisés se distinguent avec une tarification en léger retrait. » | Par Laurence Girard | jeudi 29 septembre 2022
Article réservé aux abonnés
« L’invitée surprise. » C’est ainsi que Jean-Philippe André, président de l’Association nationale des industries agroalimentaires (ANIA) qualifie l’inflation. Il se remémore, qu’il y a un an à peine, le sujet n’était même pas abordé. Depuis, la valse des étiquettes s’est enclenchée dans les rayons des supermarchés. Et le rythme ne ralentit pas. Après avoir franchi la barre des 5 % en juin, l’inflation alimentaire s’approche désormais du seuil des 10 %.
C’est le constat dressé par le cabinet d’analyses IRI France, qui publiait, jeudi 29 septembre, les données collectées à la fin de ce mois. Cette société qui scrute les achats des consommateurs après leur passage en caisse avait enregistré un premier frémissement des prix à la hausse, en décembre 2021.
Neuf mois plus tard, elle constate que les prix des produits de grande consommation ont bondi, en un an, de 9,11 %. Sur les seuls produits alimentaires, la progression est de 9,75 %. IRI France pointe les rayons épicerie salée, crémerie, surgelés et glaces, où les hausses de tarifs dépassent les 10 %. Avec une mention spéciale pour les viandes surgelées dont l’inflation frôle les 30 %. Seuls les apéritifs anisés se distinguent avec une tarification en léger retrait. » | Par Laurence Girard | jeudi 29 septembre 2022
Article réservé aux abonnés
Monday, September 26, 2022
The Dollar Is Strong. That Is Good for the U.S. but Bad for the World.
THE NEW YORK TIMES: The Federal Reserve may have no choice but to wage a relentless inflation fight, but countries rich and poor are feeling the pain of plunging currencies.
The Federal Reserve’s determination to crush inflation at home by raising interest rates is inflicting profound pain in other countries — pushing up prices, ballooning the size of debt payments and increasing the risk of a deep recession.
Those interest rate increases are pumping up the value of the dollar — the go-to currency for much of the world’s trade and transactions — and causing economic turmoil in both rich and poor nations. In Britain and across much of the European continent, the dollar’s acceleration is helping feed stinging inflation.
On Monday, the British pound touched a record low against the dollar as investors balked at a government tax cut and spending plan. And China, which tightly controls its currency, fixed the renminbi at its lowest level in two years while taking steps to manage its decline.
In Nigeria and Somalia, where the risk of starvation already lurks, the strong dollar is pushing up the price of imported food, fuel and medicine. The strong dollar is nudging debt-ridden Argentina, Egypt and Kenya closer to default and threatening to discourage foreign investment in emerging markets like India and South Korea.
“For the rest of the world, it’s a no-win situation,” said Eswar Prasad, an economics professor at Cornell and author of several books on currencies. At the same time, he said, the Fed has no choice but to act aggressively to control inflation: “Any delay in action could make things potentially even worse.” » | Patricia Cohen, Reporting from London | Monday, September 26, 2022
The Federal Reserve’s determination to crush inflation at home by raising interest rates is inflicting profound pain in other countries — pushing up prices, ballooning the size of debt payments and increasing the risk of a deep recession.
Those interest rate increases are pumping up the value of the dollar — the go-to currency for much of the world’s trade and transactions — and causing economic turmoil in both rich and poor nations. In Britain and across much of the European continent, the dollar’s acceleration is helping feed stinging inflation.
On Monday, the British pound touched a record low against the dollar as investors balked at a government tax cut and spending plan. And China, which tightly controls its currency, fixed the renminbi at its lowest level in two years while taking steps to manage its decline.
In Nigeria and Somalia, where the risk of starvation already lurks, the strong dollar is pushing up the price of imported food, fuel and medicine. The strong dollar is nudging debt-ridden Argentina, Egypt and Kenya closer to default and threatening to discourage foreign investment in emerging markets like India and South Korea.
“For the rest of the world, it’s a no-win situation,” said Eswar Prasad, an economics professor at Cornell and author of several books on currencies. At the same time, he said, the Fed has no choice but to act aggressively to control inflation: “Any delay in action could make things potentially even worse.” » | Patricia Cohen, Reporting from London | Monday, September 26, 2022
Wednesday, September 07, 2022
In Full: Former BoE Governor Warns of a "Very Unpleasant Period" Ahead
Former Bank of England Governor Mervyn King blames central banks for fuelling the cost-of-living crisis by printing too much money during the pandemic.
King headed Britain's central bank from 2003 to 2013, and oversaw the start of its QE programme in March 2009 during the global financial crisis.
But in more recent years he has criticised the scale of central bank asset purchases, which were funded by newly-created money.
King headed Britain's central bank from 2003 to 2013, and oversaw the start of its QE programme in March 2009 during the global financial crisis.
But in more recent years he has criticised the scale of central bank asset purchases, which were funded by newly-created money.
Saturday, September 03, 2022
Liz Truss Cost of Living Crisis Policies Would Make Inflation Worse | Economics | New Statesman
Aug 31, 2022 Liz truss has shown a "complete failure" to address the inflation driven UK cost of living crisis, says economist Duncan Weldon.
Economist and Journalist Duncan Weldon speaks to the New Statesman's Will Dunn to discuss his cover story in the latest issue of the New Statesman magazine, titled "The coming economic storm: As inflation reaches a 40-year high and with Britain facing a punishing recession, the Conservative leadership contenders have failed to grasp the scale of the crisis."
Economist and Journalist Duncan Weldon speaks to the New Statesman's Will Dunn to discuss his cover story in the latest issue of the New Statesman magazine, titled "The coming economic storm: As inflation reaches a 40-year high and with Britain facing a punishing recession, the Conservative leadership contenders have failed to grasp the scale of the crisis."
Economist and Journalist Duncan Weldon speaks to the New Statesman's Will Dunn to discuss his cover story in the latest issue of the New Statesman magazine, titled "The coming economic storm: As inflation reaches a 40-year high and with Britain facing a punishing recession, the Conservative leadership contenders have failed to grasp the scale of the crisis."
Economist and Journalist Duncan Weldon speaks to the New Statesman's Will Dunn to discuss his cover story in the latest issue of the New Statesman magazine, titled "The coming economic storm: As inflation reaches a 40-year high and with Britain facing a punishing recession, the Conservative leadership contenders have failed to grasp the scale of the crisis."
Thursday, September 01, 2022
Steigende Inflation in der Schweiz: Die Nationalbank muss bald nachziehen
NEUE ZÜRCHER ZEITUNG: Die Konsumentenpreise in der Schweiz sind im August weiter gestiegen. Um zu verhindern, dass sich die Inflation verfestigt und auf immer mehr Güter überschwappt, sollte die SNB den Leitzins noch diesen Monat erhöhen – dies auch als Signal an die Arbeitnehmenden.
Die Schweizerische Nationalbank ist gefordert im Kampf gegen die Teuerung. | Peter Klaunzer / Keystone
KOMMENTAR
Die europäischen Nachbarstaaten mögen die Schweiz um ihre vergleichsweise niedrige Inflation beneiden. Doch nur weil es anderswo noch schlimmer ist, kann man sich hierzulande nicht zurücklehnen. So wird auch in der Schweiz das Leben immer teurer. Neue Daten zeigen, dass die Konsumentenpreise im August gegenüber dem Vorjahr um 3,5 Prozent gestiegen sind. Der Wert liegt am oberen Rand der Erwartungen und auf dem höchsten Niveau seit den frühen 1990er Jahren. Von einer Entspannung an der Preisfront kann weiterhin keine Rede sein. » | Thomas Fuster | Donnerstag, 1. September 2022
Die europäischen Nachbarstaaten mögen die Schweiz um ihre vergleichsweise niedrige Inflation beneiden. Doch nur weil es anderswo noch schlimmer ist, kann man sich hierzulande nicht zurücklehnen. So wird auch in der Schweiz das Leben immer teurer. Neue Daten zeigen, dass die Konsumentenpreise im August gegenüber dem Vorjahr um 3,5 Prozent gestiegen sind. Der Wert liegt am oberen Rand der Erwartungen und auf dem höchsten Niveau seit den frühen 1990er Jahren. Von einer Entspannung an der Preisfront kann weiterhin keine Rede sein. » | Thomas Fuster | Donnerstag, 1. September 2022
Tuesday, August 30, 2022
Energy Prices Could Push UK Inflation to 22%, a Near Post-war Record
Inflation in the UK could top 22% next year, close to the post-war record set in 1975, if wholesale energy prices remain at current high levels, Goldman Sachs has warned.
Highlighting the pressure on households and businesses, the US investment bank said inflation could peak at 22.4% next year if wholesale gas and electricity prices continue to spiral over the winter.
In a scenario where prices “remain elevated at current levels”, economists at the bank said the Ofgem energy price cap for household bills could rise by more than 80% in January. This would “imply headline inflation peaking at 22.4%”.
Inflation rose above 10% for the first time since the early 80s in July, fuelled by surging wholesale energy prices and the rising cost of basic essentials. Inflation hit a post-war record of 24.5% in August 1975. » | Richard Partington, Economics correspondent | Tuesday, August 30, 2022
In a scenario where prices “remain elevated at current levels”, economists at the bank said the Ofgem energy price cap for household bills could rise by more than 80% in January. This would “imply headline inflation peaking at 22.4%”.
Inflation rose above 10% for the first time since the early 80s in July, fuelled by surging wholesale energy prices and the rising cost of basic essentials. Inflation hit a post-war record of 24.5% in August 1975. » | Richard Partington, Economics correspondent | Tuesday, August 30, 2022
Saturday, August 27, 2022
Stocks Plunge after Fed Chair Warns of ‘Pain’ from Inflation Fight
THE NEW YORK TIMES: The S&P 500 fell 3.4 percent, its worst daily showing since mid-June, after the Federal Reserve chair spoke about the path ahead for monetary policy.
Wall Street recoiled on Friday, after the head of the Federal Reserve delivered a stern warning that the central bank’s campaign to lower inflation by raising interest rates is “unconditional” even if it leads to pain for households, businesses and in turn stock prices.
The S&P 500 fell 3.4 percent, its worst daily showing since mid-June, taking its losses for the week to 4 percent. The slump was broad, with every sector of the index lower.
Bond investors also quickly adjusted for more rate increases from the Fed, with the two-year Treasury yield, which is sensitive to rising interest rates, moving close to its highest level of the year at 3.44 percent, before easing back to 3.38 percent.
“While higher interest rates, slower growth and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” Jerome Powell, the Fed chair, said during a speech at the Kansas City Fed’s annual conference in Wyoming. “These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.” » | Joe Rennison | Friday, August 26, 2022
Daily Business Briefing.
Wall Street recoiled on Friday, after the head of the Federal Reserve delivered a stern warning that the central bank’s campaign to lower inflation by raising interest rates is “unconditional” even if it leads to pain for households, businesses and in turn stock prices.
The S&P 500 fell 3.4 percent, its worst daily showing since mid-June, taking its losses for the week to 4 percent. The slump was broad, with every sector of the index lower.
Bond investors also quickly adjusted for more rate increases from the Fed, with the two-year Treasury yield, which is sensitive to rising interest rates, moving close to its highest level of the year at 3.44 percent, before easing back to 3.38 percent.
“While higher interest rates, slower growth and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses,” Jerome Powell, the Fed chair, said during a speech at the Kansas City Fed’s annual conference in Wyoming. “These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.” » | Joe Rennison | Friday, August 26, 2022
Daily Business Briefing.
Monday, August 22, 2022
UK Inflation Will Hit 18% in Early 2023, Says Leading Bank Citi
THE GUARDIAN: Forecasts updated after 25% and 7% rally in gas and electricity prices respectively last week
Inflation in the UK will hit 18% early next year as consumers count the cost of the deepening energy crisis, one of the world’s biggest banks has predicted.
Forecasters at the US financial services group Citi said it expects the consumer prices index to breach 18% in the first quarter of 2023, while the retail prices index inflation rate will soar to 21%.
The prediction outstrips previous modelling of the impact of rising costs. Earlier this month the Bank of England said it expected inflation to reach 13% by the end of the year as it raised interest rates for a sixth successive time.
Separately, the Resolution Foundation thinktank has forecast inflation could reach as high as 15% by early 2023.
However, on Monday Citi said the inflation rate was likely to be even higher next year with a peak of more than 18% in January. » | Alex Lawson, Energy correspondent | Monday, August 22, 2022
Inflation in the UK will hit 18% early next year as consumers count the cost of the deepening energy crisis, one of the world’s biggest banks has predicted.
Forecasters at the US financial services group Citi said it expects the consumer prices index to breach 18% in the first quarter of 2023, while the retail prices index inflation rate will soar to 21%.
The prediction outstrips previous modelling of the impact of rising costs. Earlier this month the Bank of England said it expected inflation to reach 13% by the end of the year as it raised interest rates for a sixth successive time.
Separately, the Resolution Foundation thinktank has forecast inflation could reach as high as 15% by early 2023.
However, on Monday Citi said the inflation rate was likely to be even higher next year with a peak of more than 18% in January. » | Alex Lawson, Energy correspondent | Monday, August 22, 2022
Truss Poised to Plunge UK Economy into ‘Inflation Spiral’, Says Sunak
THE GUARDIAN: Truss cannot deliver £50bn tax cuts and support packages without pushing public debt to dangerous levels, says Tory leader contender
Liz Truss will plunge the economy into an “inflation spiral” if she does not choose between her unfunded £50bn tax cuts and providing cost of living support, her Conservative party leadership opponent, Rishi Sunak, has claimed.
Sunak’s leadership campaign said Truss would increase borrowing to “historic and dangerous levels” and place public finances into “serious jeopardy” if she attempted to do both.
The comments came after Truss, the frontrunner to be the next prime minister, signalled another U-turn with direct support for companies and households with soaring energy bills this winter.
In a statement, Sunak’s campaign said: “Following weeks of rejecting direct support payments as ‘handouts’, Truss supporters have slowly woken up to the reality of what winter brings. They now say that they will provide people with help – but what help, for who, when and how it will be paid for remains a mystery. » | Tobi Thomas | Monday, August 22, 2022
Liz Truss will plunge the economy into an “inflation spiral” if she does not choose between her unfunded £50bn tax cuts and providing cost of living support, her Conservative party leadership opponent, Rishi Sunak, has claimed.
Sunak’s leadership campaign said Truss would increase borrowing to “historic and dangerous levels” and place public finances into “serious jeopardy” if she attempted to do both.
The comments came after Truss, the frontrunner to be the next prime minister, signalled another U-turn with direct support for companies and households with soaring energy bills this winter.
In a statement, Sunak’s campaign said: “Following weeks of rejecting direct support payments as ‘handouts’, Truss supporters have slowly woken up to the reality of what winter brings. They now say that they will provide people with help – but what help, for who, when and how it will be paid for remains a mystery. » | Tobi Thomas | Monday, August 22, 2022
Subscribe to:
Posts (Atom)