To expect the govt to control inflation

[Janeypj]

With inflation at 5% nearly double from previous years, how are people supposed to meet living expenses! Plus the cost of fuel! AIBU?

The Bank of England are trying to control it by increasing interest rates.

The bank of England are trying...

Fair point but the base rate has only increased by 0.15% 😯 and consumers haven’t benefited as a whole yet

@LondonQueen I’m sure they are, but how are people supposed to adjust to a 5% cost increase with a 0.15% base rate increase? Not an economist (obviously) but just seems unfair to me

Hiking up the rates too soon and too much is going to be even worse.

It's a delicate balance.

For those of us who were around in the 70s, when inflation got close to 25%, 5% is neither here nor there.

And the high interest rates introduced to restrain inflation led to significant rises in unemployment and, later, mortgage repossessions and homelessness.

Steering a course between the two is a tricky business.

Lol. What do you expect them to do - wave a magic wand?? It's not that easy... and it's the central bank, not the government, which is responsible for controlling inflation.

the gov shouldn't have surpressedt interest rates for so long.

You are obviously very young! Governments have NEVER been able to control inflation.

& it's going to get worse what with the tax hikes

plus the ongoing impact of Brexit

What specifically are you expecting needs to be done to address it?

@jeepersdeepers

the gov shouldn't have surpressedt interest rates for so long.

The Bank of England control interest rates.

For those of us with mortgages, and for the wider markets, any move to increase interest rates are alarming. It's a balancing act. I like the current governor and feel that they have done a good job so far.

Wasn’t it Milton Friedman who said inflation is taxation without legislation? Central banks have to balance.

@Janeypj

With inflation at 5% nearly double from previous years, how are people supposed to meet living expenses! Plus the cost of fuel! AIBU?

They won't. Forecasts show an additional half a million people will be choosing between heating their home and food.

It is a shame we left the EU, for sure.

If you voted for Brexit and then for this financially illiterate government, then you are part of the problem.

Mr Johnson refused in a round about way to cut VAT on fuel this afternoon.

I was a child in the 70's and my little bit of savings actually made decent interest, it was fantastic! Now you make absolutely nothing. We don't have a mortgage but have savings that make nothing so I'd love to see interest rates go up to something reasonable.

@Tal45

I was a child in the 70's and my little bit of savings actually made decent interest, it was fantastic! Now you make absolutely nothing. We don't have a mortgage but have savings that make nothing so I'd love to see interest rates go up to something reasonable.

I'm sure you would. But business panics when the cost of money goes up, which isn't good for any of us.

When inflation is being driven by imported costs on non-discretionary goods, such as food and energy, there is little the government can do. They could work together with neighbouring countries to reduce trading friction and therefore bring costs down...

I don't know the answer, but I feel 2022 is going to be bumpy for most. Catastrophic for the poorest. Food bank usage already skyrocketing

As we no longer have access to the EU energy sector, we're a lot more vulnerable to price fluctuations.

Poverty rates for DC in the UK are currently 30%. 1 in 3 DC. It's disgraceful. They need to address that before enabling savers to make a bit more money, surely.

@Mum090521

Poverty rates for DC in the UK are currently 30%. 1 in 3 DC. It's disgraceful. They need to address that before enabling savers to make a bit more money, surely.

I'm sympathetic to savers. Many retired people rely on interest for their income. No easy choices.

@Mum090521

Poverty rates for DC in the UK are currently 30%. 1 in 3 DC. It's disgraceful. They need to address that before enabling savers to make a bit more money, surely.

Benefit rates should go up to cushion the poorest from inflation. But as the Tories have made massive cuts in benefits, in real terms, over the last 11 years, I won't hold my breath.

@JustKeepSwimmingJust

When inflation is being driven by imported costs on non-discretionary goods, such as food and energy, there is little the government can do. They could work together with neighbouring countries to reduce trading friction and therefore bring costs down...

That's a great idea!

If only we could form a free trade bloc with our nearest neighbours, wouldn't that be fabulous?

It could improve labour mobility too.