Subscribe to The Money StopNews Feed

Browse > Home / Banking / Inflation levels hit 11 year high

Inflation levels hit 11 year high

August 22, 2008 by admin  
Filed under Banking

1 Comment

June saw inflation levels rise to an eleven year high of 3.8% as a result of soaring food and petrol prices, according to recent reports. The rate of inflation for May had already hit highs of 3.3%, resulting in the governor of the Bank of England, Mervyn King, having to write to the chancellor, Alistair Darling, to explain why inflation had soared so high and what would be done to bring it back down. However, the situation is now even worse, with inflation nearly double the government’s 2% target.

Many are now predicting that inflation levels will rise to over 4% by the end of this year, and interest rates are either going to remain static or may even rise as a result of soaring inflation levels despite the state of the economy. The latest minutes from the July Monetary Policy Committee meeting showed that there was a three way split, with one member voting for a cut, seven members voting for the base rate to stay on hold, and one member voting for interest rates to be increased.

However, Alistair Darling called for a restraint on wage increases due to the situation. He said: “We saw what happened in the past when inflation got out of control and people found that every penny they got in a wage increase was swallowed up by food and fuel prices going up. Whether you are in the private sector, or public sector, whether you are sitting in the board room or working on the shop floor, we cannot allow inflationary wage increases because that would mean that everyone, especially people on lower incomes, would suffer.”

However, the shadow chancellors, George Osborne, has accused the prime minister of ’shrugging his shoulders’ over the crisis facing the economy, stating: “Inflation is now more than double the rate that Gordon Brown inherited from the last Conservative government.”

Recent Additions:

Tags: recent additions, Everyone, way, member voting, committee meeting

Tags:

Related Entries

  • Sixteen year high for inflation in UK
    • According to recently released figures the level of inflation in the UK has now reached a sixteen year high, with inflation for September registering at 5.2%. The high cost of food, oil, and energy has
  • Inflation at 4.7%
    • Recent figures have shown that inflation levels in the UK have soared even further out of control, rising from 4.4% to 4.7% for August. The government target for inflation is just 2% so the current
  • Does inflation level mean that rate cuts are ruled out?
    • Inflation levels over recent months have been soaring, and in July inflation hit the highest levels since records began in 1997. coming in at 4.4%. In fact, inflation has been soaring for quite some months,
  • Will inflation levels get worse before they get better?
    • The financial headlines has recently been filled with news about the soaring rate of inflation, and this comes as no surprise given that the rate of inflation has soared to its highest level since records
  • Inflation levels continue to soar
    • Inflation levels in the UK have been at the centre of concern for the Bank of England and other government sectors for some months now, having rocketed to way over the government's target earlier this
  • Rising inflation targets young and old
    • Inflation is rising, and it is hitting the oldest and the youngest hardest. In October, inflation rose above the predicted rate of 2.1 per cent – itself above the Bank of England’s 2.0 per cent
  • Split decision on rates at last MPC meeting
    • According to the recently released minutes from the last Monetary Policy Committee meeting held in early August there was a split vote with regards to interest rate movement. However, despite this many officials now believe
  • Interest rates kept on hold for another month
    • Following the Monetary Policy Committee meeting that was held last week the Bank of England has announced that the base rate is to be kept on hold at 5% for yet another month. This signifies

Comments

One Response to “Inflation levels hit 11 year high”

Trackbacks

Check out what others are saying about this post...
  1. Supermarkets cut fuel prices says:
    August 22, 2008 at 10:19 am

    [...] Inflation levels hit 11 year high [...]



Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!