Bank of England Upgrades UK Growth
Published / Last Updated on 15/05/2013
Bank of England Upgrades UK Growth.
Inflation has been predicted to fall faster than previously thought. Sir Mervyn King, Bank of England Governor reported that inflation should fall to its target of 2% within two years. The report which showed that recovery may be within range upgraded the economic growth forecast for the UK.
In other news UK employment figures showed a rise of 15,000 in the starting months of the year, but other figure produced by the Office of National Statistics (ONS) showed that people claiming Jobseeker’s Allowance fell by 7,300.
Even though there are signs starting to show a slight recovery we are not out of the water yet.
Our View
Inflation has been predicted to fall faster than previously thought. Sir Mervyn King, Bank of England Governor reported that inflation should fall to its target of 2% within two years. The report which showed that recovery may be within range upgraded the economic growth forecast for the UK.
In other news UK employment figures showed a rise of 15,000 in the starting months of the year, but other figure produced by the Office of National Statistics (ONS) showed that people claiming Jobseeker’s Allowance fell by 7,300.
Even though there are signs starting to show a slight recovery we are not out of the water yet.
Our View
We remain unconvinced. £375bn has been pumped into the UK economy via quantitative easing in addition to the US and Japan also investing huge sums back into their economies. Inflation is the key driver to devalue record public sector debt that we can never afford to repay. We believe, if you look back in 10 years time, that we will have had a sustained period of real inflation, RPI, which includes house prices whereas CPI does not, running at 4%-5%pa.
Ask yourself, why has the Government been so keen to move civil service, teachers and other local government pensions to increase by CPI and not RPI? Why are huge pension schemes like the Post Office and BT doing the same?