Inflation watch

[kenneal - lagger]

They are all F******g Idiots! How can putting the cost of living up by increasing interest rates combat inflation in the cost of living. The inflation is being caused by the external pressure of rising fuel costs due to the war. Increasing the cost of lending, mortgage rates, isn't going to affect spending as people can only spend what they have and most people haven't got any spare cash now. Large numbers of people are cutting down on their fuel use as much as they can just so that they can eat. Putting the cost of people's mortgages up at a time when fuel costs are astronomical is going to increase the pressure on wage inflation because people are going to ask for a wage increase to cover the costs of their increased living expenses.

Why can't the BOE just eat humble pie and admit that this inflation is something that they can't control because it is caused by a war over which they have no control and increasing interest rates to combat it will simply add to the inflation?

[clv101]

Of course the other reason to increase interest rates is to prop up the value of the pound. Already precipitously weak, avoiding further collapse must also be on the agenda.

[UndercoverElephant]

Propping up the value of the pound and bringing the UK's relative inflation rate down amount to the same thing, don't they?

Personally I think the BoE has no choice, and should have done this much earlier.

[Vortex2]

World ‘plunging towards societal collapse’ as era of cheap money ends

Hedge fund Elliott hits out at central banks as prices spiral

D.Tel

[Catweazle]

Increasing interest rates makes UK banks more attractive to foreign money looking for a return, increasing demand for the £ and propping it up. As we currently buy almost all our fuel in dollars a strong £ helps keep pump prices down. A strong £ also keeps down the cost of imported food and goods. It's not going to prop up house prices, but that ridiculous situation has to end anyway.

[PS_RalphW]

I exchanged contracts on the purchase of our new house today. Half an hour later, in a separate transaction the buyer on our house pulled out. We can afford to do a staggered move to reduce the stress of moving on our mentally I’ll children, but I think I lost a minimum of £25k today.

[kenneal - lagger]

....but I think I lost a minimum of £25k today.

But at least you are keeping the golf club subscriptions of several solicitors going!! And that is what the current arrangements are about!!

[BritDownUnder]

Conveyancing in New Zealand was a breeze. Takes 10 days and little cost. Due to a computerised and efficient Land Registry.

Australia less so but still miles better than the UK. Too many vested interests in the UK stopping improvements I imagine.

[clv101]

UK CPI inflation hits 11.1% in Oct, up from 10.1% in Sep.

But this might be the peak. We're not expecting further energy price rises over winter and in the medium term there are deflationary signals. Container shipping China to Europe has crash back to 'normality', from something like $14,000 to $3,000. China factory gate prices are also falling.

[kenneal - lagger]

........China factory gate prices are also falling.

Is that a good thing? Will it mean that people just buy more useless, energy consuming Chinese tat?

[clv101]

........China factory gate prices are also falling.

Is that a good thing? Will it mean that people just buy more useless, energy consuming Chinese tat?

I said nothing about good or bad!

[BritDownUnder]

An interesting story from Australia saying that two-thirds of the inflation in Australia is from increased corporate profits and not wages.

[PS_RalphW]

It is widely reported that UK food price inflation is higher than headline inflation figures, and budget line food basics, bought mostly by the least wealthy, have the highest inflation of all. Milk has gone up 30 percent, and basic pasta a massive 70 percent. Most people have received below headline inflation wage rises, and public sector pay has gone up even less. Low wage people spend far more on food as a percentage of income than the wealthy. Corporate profits are in many cases reaching record highs, and the government has just abolished the cap on bank bonus payments to executives. Telecoms companies are increasing prices at 3 percent above inflation across the board.

I do not know why the poor are not in open revolt. Having a foreign war against those evil Russians is a godsend to this government for distracting the people.

I am unable to work at the moment due to my eyesight, yet my bank balance is not falling as fast as I feared it would. 20 years of preparing for a post peak future has kept my outgoings to manageable levels.

[kenneal - lagger]

................
I do not know why the poor are not in open revolt. ........................

Haven't you noticed the strikes? Although many of those striking aren't poor by any means!

[mr brightside]

When you say, "in open revolt", what do you have in mind?