Thursday, March 13, 2008

Inflation 5%? This is what most people (except Darling) think!

Inflation expectations reach record levels

Public expectations of future inflation have reached the highest level on record according to a BoE survey; this will make the BoE reluctant to cut interest rates. People thought prices had risen 3.9 per cent over the last year and nearly a third thought the current inflation rate was higher than 5 per cent. Opps does nobody believe Darling's CPI figure of 2.1%? Despite market expectations that the BoE will lower interest rates over the next year, 43 per cent of respondents thought interest rates would rise.

Posted by who stole my pension? @ 05:34 PM (813 views)
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5 thoughts on “Inflation 5%? This is what most people (except Darling) think!

  • surely you mean despite market ‘hopes’ that the BoE will lower interest rates?

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  • The Council Tax & Water bills have today landed on the doormat – up 3.9% & 5.2% respectively. The quarterly Gas & Electricity bills have also landed at the same time (yet to work out the percentage increase over previous years) – based on these bills I reckon I must now be heating and lighting the whole street !

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  • “People’s perceptions of the overall inflation rate are heavily influenced by highly visible price rises for items they buy often – such as food and petrol. They have also at times been more closely correlated with the retail price index – which rose to 4.1 per cent in January – than with the consumer prices index targeted by the Bank. ”

    ahh that old chestnut aye. Of course peoples perceptions are going to be influence by what they buy, because that is what matters, the REAL cost of living and not diamond solitaire rings….. dduuuuuuuuuuuhhhhhhhhh!!! I can’t believe I just read this?

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  • ‘…and nearly a third thought the current inflation rate was higher than 5 per cent’.

    Most people I know, including those who want a rate cut, believe that the real rate of inflation is about 10%.

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  • “this will make the BoE reluctant to cut interest rates”

    Are they actually trying to suggest that so long as we all live in a dreamworld where inflation is low, it will help the BoE lower rates which will be ‘good’? Inflation is inflation and should dictate teh BoE actions. The only reason peoples opinions count at all is because that’s how the government gauges whether people have seen through their lies about the real level of inflation. Which is unjustifiably immoral IMO.

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