Economists generally agree on few economic theories, but the negative impact of tariffs is one of them. The theory advocating for free trade without tariffs or barriers between countries was first articulated by Adam Smith in 1776 in “The Wealth of Nations,” showing that even if a country has an absolute advantage in producing goods, …
The extraordinarily low-interest rate era is ending – what are the implications for financial markets and policymakers?
Following a sharp rise in inflation precipitated initially by the supply-side disruption as the pandemic ended and supply lagged demand, then the Russian invasion of Ukraine, central banks are tightening policy. The US Federal Reserve is at the forefront of this charge, raising interest rates at the fastest pace since the 1980s. There is no …
Why the UK current account deficit matters
What do Russian oligarchs, the selling of UK companies to foreign investors and the slide in the pound all have in common? The answer is they all help to fund the UK’s growing current account deficit. And it is indeed widening. In Q1 2022, the UK’s trade deficit was £33.4bn, and the current account deficit …
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