Unemployment Near Interest Rate Mark

Unemployment Near Interest Rate Mark.

Figures released by the Office for National Statistics have revealed that unemployment in the UK have fallen by 167,000 in the three months to November to 2.32m.

These falls in unemployment are larger than expected and come hot in the heels of International Monetary Fund (IMF) suggesting that the UK will be the fastest growing economy within western Europe for 2014.

The results show unemployment has fallen to 7.1% and is now extremely close to the Bank of England’s benchmark of 7% for considering an increase in interest rates which have been held at 0.5%pa since March 2009.

Comment

Economic recovery, both UK and independent sources saying the UK is well placed for growth.

In addition, public sector borrowing was in December 2013 down by nearly 20% compared to December 2012, inflation has fallen to the Government’s target trend of 2.0%pa.  All good news for Government and the Chancellor.

We believe that inflation will rear its head.  We suggest we are back to boom and bust. 

Increased employment means more workers earning which leads to price rises, property price increases and other inflationary and interest rate increase pressures.

We suggest we are back to boom and bust.