Mervyn King plays down the threat of inflation
Mervyn King, the governor of the Bank of England, has this evening played down the threat of inflation in the UK suggesting that inflation is just as likely to under shoot its target as to overshoot. This is the first major speech from Mervyn King since August and would appear to suggest, just prior to the issue of October MPC minutes, that there is some debate within the committee as to the direction of the UK economy.
Mervyn King has many months suggested that UK inflation is not a reliable measure of economic activity and the underlying strength of the UK economy. He has for some time believed that inflation will fall back to within the banks 2% target rate in the short to medium term without any major action from the authorities. Indications that the UK economy is beginning to weaken, after a period of relative buoyancy, would seem to support this belief although so far the figures have refused to fall into place.
The Bank of England is beginning to give the impression of a body which is frustrated by the relative strength of inflation despite numerous attempts to talk down the threat of inflation in the UK.
Lloyds Bank surprises City with a warning
Lloyds Bank today warned the City that corporate bad debts at the group are expected to soar by around 50% this year but more worryingly, the company has yet to finalise its participation in the government's insurance scheme for toxic assets. Many were under the impression that Lloyds Bank was already confirmed as a member of the scheme but today's announcement would appear to indicate otherwise.<...Read More
Why Was Alistair Darling So Frank About The UK Economy?
Alistair Darling's interview with the Guardian newspaper seems to have prompted more questions than it has answered with people still in shock at the style and frankness of the interview and wondering exactly why he undertook such a high risk strategy.
It was his comment that he did not know when the economy would stop slowing and the language which he used which prompted many in hi...
Could swine flu cost the UK economy £50 billion?
When a renowned figure such as the Ernst & Young ITEM club makes a prediction that the swine flu pandemic in the UK could cost the country around £50 billion it certainly is time to sit up and listen. As we have covered on a number of occasions, not only is there a potential loss of life, with the UK government expecting a maximum 65,000 fatalities from the pandemic, but the loss of business and...Read More
Northern Rock chief escapes his day in court
At a time when it gave the government some credibility with the UK voters there were loud calls for the former chief executive of Northern Rock to face legal action over his handling of the fallen angel. However, we see this time and time again with MPs rushing to gain public favour by attacking those in the news and threatening action when it was never really on the cards. After all what could...Read More