A small rate rise soon could be preferable to larger increases later - a case of “a stitch in time saves nine”. However, subdued money growth and strong competition should help keep inflation down. The Bank of England’s MPC left UK interest rates at 3.75% today, as expected, but the 6-3 split was more hawkish. … Continue reading Bank of England edges closer to an autumn hike
Category: Monetary policy
Don’t bank on a “Burnham bounce”
Andy Burnham's first week as PM has coincided with some better economic news. The more positive tone from No.10 may help a little further, but the inflation and fiscal risks haven't gone away. Andy Burnham’s first week as Prime Minister has coincided with some better news on the UK economy and especially on business and … Continue reading Don’t bank on a “Burnham bounce”
Burnham’s first big idea: lower your bills by raising your taxes?
It is obviously a bit harsh to judge anyone’s premiership by just one announcement on the first day, but a token cut in VAT on domestic electricity bills does not bode well. In case you missed it, the new government has announced that the rate of VAT charged on domestic electricity bills will be cut … Continue reading Burnham’s first big idea: lower your bills by raising your taxes?
The Bank is unlikely to raise rates this week, but maybe it should?
There are three good reasons to expect the Bank of England’s MPC to “wait and see” for at least another month. Nonetheless, there may be one even better reason to pull the trigger now - "credibility". A Reuters poll of sixty-five economists last week found that all sixty-five expect the Bank of England’s Monetary Policy Committee to … Continue reading The Bank is unlikely to raise rates this week, but maybe it should?
