UK deflation: Why the normal rules just don’t apply May 19, 2015 Today, it was announced that the UK is in a period of deflation. It will almost certainly be a brief period. On the face of it, there is not much difference between the price level being stable and the price level falling by 0.1 per cent a year. At that rate, it would take [...]
What is the difference between good and bad deflation? May 19, 2015 Official data released today has shown that the UK slipped into deflation for the first time in over 50 years. Normally the word deflation has economists running for the hills, but this time around the mantra has been that this is very much a case of "good deflation". But just what is good deflation, and [...]
Inflation turns negative for the first time in over 50 years – but it should only be a blip May 19, 2015 Britain fell into deflation for the first time since the 1960s after data released today showed the consumer price index (CPI) had dipped into negative territory. The Office for National Statistics said prices fell 0.1 per cent in the year to April on a fall in air and sea fares due to the timing of [...]
Deflation, no demand: Global economies struggling to up inflation and stagnation is on the rise May 18, 2015 We are now well into the second phase of post-financial crisis recovery. The first, terrifying phase was the period when central banks had to cut interest rates to zero and then develop and deploy new, unconventional weapons, including QE. The European Central Bank (ECB) had to be more imaginative than others, as it tried [...]
Britain could be about to enter brief deflation May 17, 2015 The UK could enter deflation for the first time since comparable records began when figures are released tomorrow morning. Yet most economists believe inflation’s venture into negative territory will be short-lived, given that oil and global food prices have halted their declines. The consumer price index (CPI) – the basket of goods used to measure [...]
Turnover across UK restaurants reaches £21.6bn May 17, 2015 The turnover of Britain’s restaurant industry has risen by 39 per cent since the recession thanks to a wave of new start-ups and the growth of smaller chains to reach £21.6bn last year. Finance provider LDF said the turnover of the restaurant sector has grown from £15.5bn in 2010, driven by the expansion of so-called [...]
Four charts that sum up the week: Sterling rallies, UK growth forecast cut, London house prices rise and Europe beats Britain May 15, 2015 London house prices ended seven months of decline, the Bank of England said it was feeling less optimistic about the UK economy and the French economy sped ahead of Britain and Germany in the first quarter, this week. Here are four charts that sum up what happened. 1. London house prices are on the up again, [...]
Mark Carney moves the goalposts again as interest rate hike seems way off – Bottom Line May 13, 2015 Unemployment is down, wages are up and inflation is forecast to rise too high in a couple of years. Surely it is time to raise interest rates, isn’t it? Not so, Mark Carney said yesterday. Borrowers may cheer, but it is a touch worrying that the governor seems keen to keep rates down for [...]
A tale of two economies: Why the Bank of England risks a sharp hike in interest rates May 13, 2015 We were offered two conflicting views of the UK economy yesterday, from the monthly Labour Market Statistics and the Bank of England’s quarterly Inflation Report. The Labour Market Statistics presented a picture of a booming economy and accelerating wage inflation. Unemployment has fallen by about 400,000 over the past year and the jobless rate [...]
Bank of England inflation report: UK growth expectations cut May 13, 2015 The Bank of England today slashed forecasts for how much its expects the economy will grow this year to 2.5 per cent, down from 2.9 per cent. Threadneedle Street also said it expects interest rates to remain close to historical lows for the foreseeable future, before rising some time in the second quarter of 2016. [...]