Realistbear Posted May 13, 2007 Share Posted May 13, 2007 http://business.timesonline.co.uk/tol/busi...icle1781347.ece From The Sunday Times May 13, 2007 Inflation to fall below 3% David Smith INFLATION is set to drop back below 3% this week, easing pressure on the Bank of England. But analysts warn that it is too early to sound the all-clear on interest rates, and businesses still fear further rises...../ Analysts expect this week’s figure to show a fall to 2.8%, on the way to a sharper drop to the 2% target level later in the year. “Headline” retail price inflation is expected to fall from 4.8% to 4.5%. Let's see, it must be the cheaper petrol? No, not that. How about the lower council tax bills? No, it can't be that. Falling oil prices--no they are headed back up. I know, its the falling food prices..................no? How about, ummmmmmmmmmmm Train tickets--that' it, the cost of travel went down. Not that either? Go on Merv tells us what is getting Cheaper? MP3 players!!!!!!!!!!! Of course, who could have thought up that one. Quote Link to comment Share on other sites More sharing options...
StainlessSteelCat Posted May 13, 2007 Share Posted May 13, 2007 It was the interest rate rise wot dun it! Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted May 13, 2007 Share Posted May 13, 2007 Going to raise some real credibility issues. We know why the figures MAY fall back below 3% - bigger numbers falling out from last year's numbers. The general public will look at their bills and will be left wondering quite what is going on knowing damn well that inflation hasn't fallen since the last month, in fact quite the reverse. Sooner or later trust in the CPI as a measure is going to fall apart. Roll on more double digit broad money supply and $80 oil. Quote Link to comment Share on other sites More sharing options...
Willy Weasel Posted May 13, 2007 Share Posted May 13, 2007 http://business.timesonline.co.uk/tol/busi...icle1781347.ece From The Sunday Times May 13, 2007 Inflation to fall below 3% David Smith INFLATION is set to drop back below 3% this week, easing pressure on the Bank of England. But analysts warn that it is too early to sound the all-clear on interest rates, and businesses still fear further rises...../ Analysts expect this week’s figure to show a fall to 2.8%, on the way to a sharper drop to the 2% target level later in the year. “Headline” retail price inflation is expected to fall from 4.8% to 4.5%. Let's see, it must be the cheaper petrol? No, not that. How about the lower council tax bills? No, it can't be that. Falling oil prices--no they are headed back up. I know, its the falling food prices..................no? How about, ummmmmmmmmmmm Train tickets--that' it, the cost of travel went down. Not that either? Go on Merv tells us what is getting Cheaper? MP3 players!!!!!!!!!!! Of course, who could have thought up that one. Nothing needs to fall in price at all - prices just need to rise more slowly than 12 months previously for inflation to fall Quote Link to comment Share on other sites More sharing options...
Realistbear Posted May 13, 2007 Author Share Posted May 13, 2007 Nothing needs to fall in price at all - prices just need to rise more slowly than 12 months previously for inflation to fall Stealth inflation. Brown strikes again. Quote Link to comment Share on other sites More sharing options...
sign_of_the_times Posted May 13, 2007 Share Posted May 13, 2007 Nothing needs to fall in price at all - prices just need to rise more slowly than 12 months previously for inflation to fall but 12 months ago firms were still absorbing higher costs. its only recently they've decided to push up their prices. do you think they'll suddenly stop ? the only reason inflation will fall is down to fiddling of the cpi basket Quote Link to comment Share on other sites More sharing options...
BuyingBear Posted May 13, 2007 Share Posted May 13, 2007 All hail the Chinese Products Index. Quote Link to comment Share on other sites More sharing options...
Realistbear Posted May 13, 2007 Author Share Posted May 13, 2007 All hail the Chinese Products Index. Quote Link to comment Share on other sites More sharing options...
Guest mattsta1964 Posted May 13, 2007 Share Posted May 13, 2007 All hail the Chinese Products Index. Quote Link to comment Share on other sites More sharing options...
dog Posted May 13, 2007 Share Posted May 13, 2007 Stealth inflation. Brown strikes again. BBC But the bank said it was particularly concerned that the ONS was using only a limited sample of shops and stores to measure price increases each month, and called for the reintroduction of a full rotation of locations for sampling.. Quote Link to comment Share on other sites More sharing options...
Guest portwinestain Posted May 13, 2007 Share Posted May 13, 2007 All hail the Chinese Products Index. Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted May 13, 2007 Share Posted May 13, 2007 BBCBut the bank said it was particularly concerned that the ONS was using only a limited sample of shops and stores to measure price increases each month, and called for the reintroduction of a full rotation of locations for sampling.. There won't be any need for rotation once the small shops have been wiped out by rising costs. They are the ones that relly need to raise prices to survive, their pricing is the type that will not magically appear in the CPI index. Quote Link to comment Share on other sites More sharing options...
john_d_uk Posted May 13, 2007 Share Posted May 13, 2007 BBCBut the bank said it was particularly concerned that the ONS was using only a limited sample of shops and stores to measure price increases each month, and called for the reintroduction of a full rotation of locations for sampling.. I've sussed it, in the true style of lazy BBC journalism, and Government spin, the ONS 'samplers' must use the subsidised canteen for their inflation figures.... A latte in Starbucks last week £3.00 A latte in ONS canteen this week 35p Inflation beaten. Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted May 13, 2007 Share Posted May 13, 2007 About time the ONS opended their books and their statistical methods, sampling, raw data, the whole shooting match to full scrutiny. People are now in a position where they are having to assess the real rate of inflation themselves, they can no longer realy on ONS figures, nor any remit that the BOE may or may not wish to follow based on them. What have the BOE seen that nobody else has? Quote Link to comment Share on other sites More sharing options...
john_d_uk Posted May 13, 2007 Share Posted May 13, 2007 About time the ONS opended their books and their statistical methods, sampling, raw data, the whole shooting match to full scrutiny.People are now in a position where they are having to assess the real rate of inflation themselves, they can no longer realy on ONS figures, nor any remit that the BOE may or may not wish to follow based on them. What have the BOE seen that nobody else has? GordEnron's 'clunking fist' Quote Link to comment Share on other sites More sharing options...
petetong Posted May 13, 2007 Share Posted May 13, 2007 Can someone explain how the inflation figure calculation has changed under Brown's tenure. What would be the figure using the old method ? Quote Link to comment Share on other sites More sharing options...
Charlie Don't Surf Posted May 13, 2007 Share Posted May 13, 2007 Would it not be a good idea if the CPI was calculated by an independent body too? What is the point of the BoE being 'independent' but the measure they work to is not? Quote Link to comment Share on other sites More sharing options...
Casual Observer Posted May 13, 2007 Share Posted May 13, 2007 Can someone explain how the inflation figure calculation has changed under Brown's tenure. What would be the figure using the old method ? 4.8%, as measured by the RPI index. Although CPI and RPI have different values, due to them measuring different baskets of goods and sefrvices, the relationship between them hasn't varied a tremendous deal. In other words, if CPI hadn't been introduced and the MPC had been asked to target RPI at say 3.5%, IR decisions probably would have been no different over the last 10 years. Quote Link to comment Share on other sites More sharing options...
Fancypants Posted May 13, 2007 Share Posted May 13, 2007 In other words, if CPI hadn't been introduced and the MPC had been asked to target RPI at say 3.5%, IR decisions probably would have been no different over the last 10 years. except the old RPI target was 2.5% Quote Link to comment Share on other sites More sharing options...
nohpc Posted May 13, 2007 Share Posted May 13, 2007 RB I'm not sure you understand what inflation is. It is the rate of increase of basket of goods. Prices do not have to fall for the CPI to decrease they just have to rise less slowly. I think this kind of ruins your point. Dropping prices (which generally I see everywhere when it comes to luxury items as you mentioned) across the board would spell deflation and recession. Not what we want to see I feel. Quote Link to comment Share on other sites More sharing options...
Casual Observer Posted May 13, 2007 Share Posted May 13, 2007 http://www.statistics.gov.uk/downloads/the...rget_031210.pdf Chart 3 shows deviations between CPI and RPIX Quote Link to comment Share on other sites More sharing options...
Casual Observer Posted May 13, 2007 Share Posted May 13, 2007 (edited) except the old RPI target was 2.5% RPIX target was 2.5%. RPI also used to be targetted. The important thing, when debating the validity of CPI as a targettable measure, is how the results they have produced have deviated between each other. Edited May 13, 2007 by Casual Observer Quote Link to comment Share on other sites More sharing options...
His Tonyness Posted May 13, 2007 Share Posted May 13, 2007 I'm quoting OnlyMe here... "Sooner or later trust in the CPI as a measure is going to fall apart." My trust in the CPI measure was nuked (never mid fell apart) ages ago as unfortunately, I don't live on a diet of LCD HD TVs, iPods, computers, and endless other tatt which is imported from the far east. I need food to live (iPods are pretty are bad for the digestive tract and are tasteless, even with tomato ketchup on...), a roof over my head, reasonable council tax costs, reasonable petrol costs and endless other things which are wiping me out, month on month. Quote Link to comment Share on other sites More sharing options...
Casual Observer Posted May 13, 2007 Share Posted May 13, 2007 I'm quoting OnlyMe here... I don't live on a diet of LCD HD TVs, iPods, computers, and endless other tatt which is imported from the far east. You don't actually fall for the myth that CPI only has electronic goods in its basket do you? Quote Link to comment Share on other sites More sharing options...
OzzMosiz Posted May 13, 2007 Share Posted May 13, 2007 so if prices for everything rise 1200000000% one year and are static the next, everything is fine!!!!! Quote Link to comment Share on other sites More sharing options...
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