We can live with zero inflation: The two per cent target must not be set in stone March 26, 2015 For the first time since the 1960s, the main measure of UK inflation has fallen to zero. While this seemed to be a shocking fact for many economic commentators, it should not be a great surprise. For over 30 years, defeating inflation and achieving price stability have underpinned UK economic policy. Low inflation became a [...]
Surprise as UK inflation falls to zero for first time since current records began in 1989 March 24, 2015 Inflation fell to zero in February for the first time since current the current records began in 1989, moving Britain closer to deflation, official statistics showed today. Figures released by the Office for National Statistics showed prices didn't increase at all in February compared with the same time a year ago. The figure came [...]
Bank of England minutes: Strong pound risks exacerbating deflation March 18, 2015 Bank of England policymakers think the strong pound could exacerbate the current period of low inflation. Minutes released today showed the monetary policy committee believes divergent monetary policy trends, and a strengthening economy, could cause the pound to appreciate further. "This has the potential to prolong the period for which consumer price inflation would remain [...]
Inflation basket of goods: Ecigarettes and craft beer in, yoghurt drinks and sat navs out March 17, 2015 A sign of modern life, or a marker of British society's inexorable slide into middle classness? The Office for National Statistics (ONS) has performed its annual reshuffle of the basket of goods, the items it uses to measure inflation. It's all gone a bit… Waitrose-y. Among the additions to the basket are refills for ecigarettes, [...]
Bank of England governor Mark Carney says global deflation forces, strong sterling could delay rate hike March 12, 2015 Bank of England governor Mark Carney has said that low inflation outside of the UK, as well as a strong sterling, could cause the central bank to push back a rate hike. "It may be appropriate to take into account persistent external deflationary forces arising from the combination of continued foreign low inflation and the [...]
Inflation expectations slide to 13-year low March 6, 2015 Britain's expectations for inflation over the next 12 months have fallen to a level not seen in 13 years. The Bank of England's survey showed people's inflation expectations for the year ahead slumped to 1.9 per cent, down from 2.5 per cent in November, or the lowest since 2002. "While inflation expectations have softened appreciably [...]
Our key takeaways from Mark Carney’s speech on UK interest rates February 24, 2015 During a speech to MPs earlier today, Bank of England governor Mark Carney said an interest rate hike before the end of the year looked likely. Reading out highlights from the central bank's quarterly inflation report, he told parliament’s treasury select committee that the rise would take place despite low consumer inflation, which [...]
Bigger pay packets give pound a lift as sterling hits seven-year high against the euro February 18, 2015 Sterling soared to a seven-year high against the euro yesterday, pushed up by record jobs figures and rising wages, with some investors expecting a Bank of England rate hike to come sooner than had been expected. The UK’s employment level jumped to an equal record high of 73.2 per cent at the end of [...]
In charts: Bonuses help push UK wage growth up to 2.1 per cent as unemployment falls February 18, 2015 The UK’s unemployment rate tumbled to 5.7 per cent between October and December, while growth in pay rose to its highest since 2013, according to "corking" figures published by the Office for National Statistics today. Pay leapt 0.4 percentage points to 2.1 per cent including bonuses, but slowed to 1.7 per cent excluding bonuses. The [...]
Plunging inflation may knock deficit reduction February 17, 2015 Inflation fell to a record low in January, giving a welcome boost to hard-pressed households – but a group of economists warned the drop will harm the government’s finances, because tax receipts rise when prices go up. Prices rose by just 0.3 per cent in the 12 months to January, the Office for National Statistics said [...]