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Inoperational Bumblebee

Inflation up Feb 2017 - CPI 2.3%

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They're now over their mandated target, requiring a change in intervention / moves to tame the beast.

But I'm pretty sure they'll delay for a while, saying that it is meant to be read as an average over x months years.

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13 minutes ago, dgul said:

They're now over their mandated target, requiring a change in intervention / moves to tame the beast.

But I'm pretty sure they'll delay for a while, saying that it is meant to be read as an average over x months years.

It's not a monthly target. It's over the 'forecast horizon'. Which is right. Why would a central bank raise/lower rates on a monthly basis? That would be insane.

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1 minute ago, GrizzlyDave said:

Look through the looking glass - interest rates will rise :-)

You must have bought the long distance version. The government will wish to do very little at this sensitive stage - imagine if over indebted Tory voters in the home counties started struggling to pay their mortgages at the precise moment the Brexit negotiations are starting... Not good for the voting intentions dear boy, not good for the voting intentions.

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7 minutes ago, GrizzlyDave said:

Look through the looking glass - interest rates will rise :-)

Inflation went to well over 5% in 2011 and the BOE did nothing. Afterwards inflation then fell back sharply. The BOE will only act if there is a definite wage/price spiral ( most unlikely) and even if there was it would take a couple of years to become apparent or there is a collapse in sterling. Living standards will suffer but why make things worse by putting IRs up when the chances are it will work its way through the system? 

I am sure Carney will leave the BOE in 2019 as he has said and I think he will go never having increased rates.

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Lots of MSM reaction about these figures being because of devaluation following Brexit vote. No mention of the extra £60,000,000,000 conjured up last summer being a cause.

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What about CpiH or whatever new one they're starting to use?

Tis, in my view, just the start.  Seeing lots of price rises coming through, oil, petrol creeping up too.  £ devaluing a bit more should see more prices.

Yet they're all still saying it will settle to 2%?!?!?!?!

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41 minutes ago, Little Frank said:

It's not a monthly target. It's over the 'forecast horizon'. Which is right. Why would a central bank raise/lower rates on a monthly basis? That would be insane.

Not like dropping the base rate in response to brexit then?

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18 minutes ago, rantnrave said:

Lots of MSM reaction about these figures being because of devaluation following Brexit vote. No mention of the extra £60,000,000,000 conjured up last summer being a cause.

Bad news - Brexit 

Good news - Despite Brexit 

 

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They'll look through the figures for sure but nevertheless combined with the US rate increases the prospect of UK rate increases has definitely got closer.  It's just possible that the BoE will increase rates to give a buffer to reduce them if the fake stats turn down because of recession (blamed on events overseas)

The other thing is that Nirp seems off the table as a possibility for the time being at least.

 

Edited by billybong

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1 hour ago, Little Frank said:

It's not a monthly target. It's over the 'forecast horizon'. Which is right. Why would a central bank raise/lower rates on a monthly basis? That would be insane.

Er, how did the BOE justify their knee jerk reaction in dropping rates after the referendum? 

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All is not as it seems. CPI is only at 2%.

The reason for the big jump in the headline inflation figure is partly due to a move by the ONS to use CPIH, which includes housing costs (measures of rent, HPI and council tax), to give a more accurate picture of inflation.

just edited this - got my figures wrong

 

No chance of a rise in interest rates anytime soon.  As has been said many times on this site before, Carney didn't raise rates when CPI spiked to >5% in 2011 and will ontinue to "look through" it and "remain vigilant".

Edited by InlikeFlynn

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We just need a few more months where everybody thinks inflation is the problem.Then we can have our massive debt deflation.The Fed and the Boe have tightened far too much already by removing QE and will probably see us enter into the last stage of this depression later this year.It could be China the trigger,or one of many things,but deflation will rip through soon enough and send some banks under and massive debt defaults.Thats when central banks will go money printing crazy in blind panic and the real inflation (10%) will arrive after that around 2020 and interest rates close behind.

I see gold being the place to be until maybe July,then treasury bonds.We will get a huge reflationary cycle,no doubt about that,but i think after a massive final deflationary crunch first.

Houses will tank whatever the outcome,and maybe by eye watering amounts.Just my opinion.

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11 minutes ago, LondonIsFallingDown said:

So they put in housing costs and come to the same answer of 2.3% as CPI and CPIH give the same number! I do hope there will be some analysis of this around......

ignore me - I'm talking nonsense

Edited by InlikeFlynn
got my figures wrong

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14 minutes ago, InlikeFlynn said:

All is not as it seems. CPI is only at 2%.

The reason for the big jump in the headline inflation figure is partly due to a move by the ONS to use CPIH, which includes housing costs (measures of rent, HPI and council tax), to give a more accurate picture of inflation.

No chance of a rise in interest rates anytime soon.  As has been said many times on this site before, Carney didn't raise rates when CPI spiked to >5% in 2011 and will ontinue to "look through" it and "remain vigilant".

No, CPI was 2.3% 

https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/latest

  • The Consumer Prices Index (CPI) 12-month rate was also 2.3% in February 2017, compared with 1.8% in January.

It wasn't Carney it was Merv

 

 

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14 minutes ago, Little Frank said:

No, CPI was 2.3% 

https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/latest

  • The Consumer Prices Index (CPI) 12-month rate was also 2.3% in February 2017, compared with 1.8% in January.

It wasn't Carney it was Merv

 

 

You're right Frank/RK - I got my figures wrong. Picked up an incorrect figure from Forex Factory. Have edited my earlier posts accordingly

 

Edited by InlikeFlynn

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