CPI Inflation at 2.7%. Will Interest rates rise soon?

  • Inflation is rising and I believe this is the reason why May is holding a general election now rather than just before the end of Brexit negotiations. It's not about giving May a stronger negotiation hand in Brexit negotiations but instead its about the Conservatives know that they will need to raise interest rates soon to curb inflation and that is a vote loser.


    Although sterling has risen a bit, its still way down on the pre-referendum level. It's currently at $1.30.


    The drop in sterling did not have a immediate effect, but certainly since the beginning of this year, we are all feeling it. It's not that prices in the shops are necessarily more expensive, but the size of the goods you get has shrunk while the price has stayed the same. Ie you pay the same price for a packet of biscuits or bottle of shampoo but you find you're getting less biscuits for the same money and the shampoo bottle is smaller. In effect a price rise.


    As said, I think this is the reason for the general election and I reckon interest rates will be risen soon after the election. What do you think? The Bank of England has a legal obligation to curb inflation it it rises above 2%. Soon, it'll be over 3.


    The only people who will be happy with a interest rate rise will be the savers who have all been punished over these last ten years with next to zero rates on our savings.

    If my post is in this colour, it is a moderator decision. Please abide by it.

Create an account or sign in to comment

You need to be a member to leave a comment.