Most recent figures suggest that consumer prices are increasing, while average wages are stagnating – meaning that people across the country are facing higher costs of living. To finance higher costs of living, more and more people are borrowing.
The Bank of England will announce its latest interest rate decision later today. The monetary policy committee, including departing Deputy Governor Charlotte Hogg, is expected vote to keep rates just above zero.
With this week’s budget, the Chancellor doubled down on a failed economic model. The government will continue cutting spending into the next parliament, and earlier this week, it was revealed that the Treasury has asked most departments to find an extra 6% of savings.
From 2009 to 2012, the Bank of England created £375bn of new money. In response to potential economic uncertainties arising from the Brexit vote, the Bank of England announced it would expand its Quantitative Easing (QE) programme by an extra £70bn – bringing QE to a total £445bn.
The Bank of England revealed today that it forecasts inflation to rise to 2.8%, well above its 2% target. The combination of rising prices, stagnating incomes and slowing employment growth is bad news for households, as they face a higher cost of living across the board.