With inflation continuing to rise and central banks reacting by raising interest rates, the critical question must be how high will rates have to rise to curb inflationary pressure? To do that, we need to consider what a ‘neutral’ interest rate – one that kept prices steady – would look like, and how much higher …
Economic shocks and the tightrope to growth
Yet again, the Chancellor’s Spring Statement turned into a Spring Budget. Expectations were that the Government would intervene to alleviate the impact of higher fuel and food prices on household income. Whilst fuel duty was cut by 5p a litre for 12 months and the National Insurance threshold raised, for many, those expectations weren’t met, …
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Why price inflation will remain low even with record debt
UK government debt is running at £400 billion a year or 20% of GDP. Money supply growth is rising by nearly 14% per annum and the ratio of outstanding debt GDP – 85% of the economy just last year – is set to be around 108% of GDP in the 2020/2021 financial year. Surely that’s …
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