RPI, CPI and RPIX are three different measures for calculating inflation. To summarise CPI = headline rate (excludes mortgage interest payments, housing costs) RPI = Retail Price Index. Includes mortgage payments. Source: ONS In 2009, the UK saw a cut in interest rates, and therefore, a fall in mortgage repayments. This caused RPI to become …
The UK economy in 2016 is emerging from a long period of economic stagnation and the recession of 2008-12, and has some positive signals of growth, low inflation and falling unemployment. However, the UK chancellor has been giving mixed signals. On the one hand he has pointed out that UK has one of the strongest …
I’m off to New York on Wednesday, I’m tempted to stay until May 8th, so I can miss the UK General election campaigning, which so far has been quite depressing for the poor quality of economic debate. This is just an outline of some issues for consideration. I may expand upon these in the coming …
A look at the nature of the UK economic recovery. Is the recovery sustainable? Who has benefited the most from recovery? Which groups of people have not benefited from the recovery? In the past two years, the UK economy has posted relatively impressive growth figures. The UK posted annual growth of 2.6% between Q3 2014 …
Readers Question: What is the UK’s target for economic growth? Economic growth is the annual % increase in national output (Real GDP) The UK doesn’t have an explicit target for economic growth (for example, we have an inflation target of CPI 2%+/-1.) However, the government will aim to achieve economic growth close to the …
Readers Question Why is the forward guidance threshold set at 7% unemployment and how does this affect the threshold for inflation? The MPC have a remit to target inflation of CPI = 2% +/-1. But, the MPC also consider wider issues of economic growth and unemployment. UK Real GDP is still lower than the level …
After faltering for several years, the UK economy shows signs of real recovery, with rising spending, investment, exports and even manufacturing growth. At the start of 2014, there seems to be a virtuous circle of falling unemployment, falling inflation, and rising GDP. After one of the longest and deepest recessions on record, these signs of …
Readers Question: I am currently researching the impact of the global economy on inflation in the UK. I have come across economic policy uncertainty but am unsure what effect policy uncertainty in the EU and USA will have on the UK. UK inflation is primarily due to domestic factors. For example, if you look at …