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UK CPI hits 3.1%, sterling hits $2
Posted: 17 Apr 2007, 09:53
by mikepepler
news story
LONDON (MarketWatch) -- U.K. annual inflation in consumer prices reached 3.1% in March, up from 2.8% in February, driven by a rise in the price of food and non-alcoholic beverages, the Office for National Statistics said Tuesday. The jump in inflation above 3% means the Bank of England's governor, Mervyn King, will have to write to Gordon Brown, the chancellor of the exchequer, explaining why inflation continues to run above the government's 2% target.
Posted: 17 Apr 2007, 11:16
by Totally_Baffled
Perhaps Mr Kings letter should also include a little paragraph on what rising interest rates will do the gargantuan personal debt and mortgage mountain in the UK.
That should get Mr Browns premiership off to a roaring start !
Posted: 17 Apr 2007, 13:30
by Pete_M
I noticed on the BBC web site this article :
http://news.bbc.co.uk/1/hi/business/6563013.stm
Near the end the question is :
Will we see a return to high inflation and high rates, then?
Part of the answer is :
And energy prices are coming down too, especially for household energy like gas.
This doesnt match my expectations. I had imagined that with summer electricity demand, generation issues etc the cost would go up. Then coming into winter Id expect further upward pressure on prices.
So I'd expect the answer to be : Yes, there will be more upward pressure on inflation and a risk of further rate rises.
I wonder what others think?
Pete M
Posted: 17 Apr 2007, 16:32
by Kentucky Fried Panda
On a positive note, now is the time to buy cheap stuff from America.
Posted: 17 Apr 2007, 16:58
by Pete_M
On a positive note, now is the time to buy cheap stuff from America.
Could it be the right time to import Solar panels from the states? Anyone fancy sharing a container?
I have no idea how to go about this and I assume that the shipping costs would outweigh the savings but if the dollar keeps dropping it might become possible.
Pete M
Posted: 17 Apr 2007, 18:57
by mikepepler
I noticed that Mervyn King's letter to Gordon Brown blamed high oil prices for inflation. I wonder how that works, given that they were higher still last summer...? I suspect it's got more to do with a couple of years' worth of high oil prices finally feeding through in second-round effects, along with biofuels and bad weather reducing food production.
Hurricane season's only 6 weeks away too, and unless we get a quiet season for the GOM like last year, then prices will probably set another new record.
Posted: 17 Apr 2007, 21:12
by snow hope
RPI = 4.8%
Fasten your Seat Belts - in fact get an extra set!
Posted: 17 Apr 2007, 21:30
by oilslick
mikepepler wrote:I noticed that Mervyn King's letter to Gordon Brown blamed high oil prices for inflation. I wonder how that works, given that they were higher still last summer...? I suspect it's got more to do with a couple of years' worth of high oil prices finally feeding through in second-round effects, along with biofuels and bad weather reducing food production.
That and increasing the money supply by 10+% every year - got to find a home eventually. Inflation really isn't going away any time soon - and they're making it all much worse by pretending it'll go away. I hope they get what they deserve when this is all over as it is going to a right royal mess.
Posted: 18 Apr 2007, 00:26
by grinu
They're forecasting a very active hurricane season this year after the dissipation of last yrs El nino conditions (that inhibited hurricane formation) and given the forecast of warm waters. I think we may be in for an interesting summer given the current political, economic and geographical climate.
Posted: 18 Apr 2007, 00:53
by clv101
And remember we're already drawing down OECD oil stocks at 1mbpd...
Posted: 18 Apr 2007, 18:06
by mocara
Are we? Damn, I missed that bit.
Posted: 18 Apr 2007, 18:36
by Kentucky Fried Panda
Pete_M wrote:On a positive note, now is the time to buy cheap stuff from America.
Could it be the right time to import Solar panels from the states? Anyone fancy sharing a container?
I have no idea how to go about this and I assume that the shipping costs would outweigh the savings but if the dollar keeps dropping it might become possible.
Pete M
I was thinking more along the lines of Katadyn water filters and the like which cost an arm and a leg here.
Most PV panels aren't made in the USA, surely it'd be cheaper to import them from the source? China/Japan/Malaysia
Posted: 19 Apr 2007, 17:06
by mikepepler
http://newsvote.bbc.co.uk/1/hi/business/6571043.stm
Lenders pull fixed-rate mortgages
Lenders have started to withdraw their fixed-rate mortgage products in preparation for a possible Bank of England (BoE) interest rate rise.
...
Many analysts now believe that a rise in UK interest rates in May is inevitable, with that feeding through into the money market rates, also pushing them higher. This will result in higher costs for lenders and they will pass these on to consumers. "Many lenders are currently offering rates below the money market rate and this cannot go on forever," said Roy Hardy, a mortgage broker at Cobalt Capital.
Posted: 20 Apr 2007, 12:51
by brasso
When you consider the growth in money supply recently, this 'sudden' inflation becomes quite understandable. The price of oil and the Iraq occupation are both fuelling government costs. Don't forget that we also own over $200bn of US debt. Wow, that was a good investment decision...
http://goldnews.bullionvault.com/Pound_money_supply_BoE