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CCFCSteve

Well-Known Member
David O'Day said:
interest rate rise today :(
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Got to happen unfortunately. The Fed raised theirs again by 0.75 yesterday and then came out and said that they expect the terminal rate (when they finally stop raising) to be higher than anticipated as their core inflation hasn’t started coming down as hoped

Basically Americas fiscal policy* of chucking money at everyone and everything causing massive demand led inflation has fucked things for a lot of countries…especially the EU and ourselves that have also got the wars energy inflation to deal with…and then Trussenomics (although impact of that’s pretty much unwound now). International shitshow !

*in conjunction with post covid supply/demand issues
 
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CCFCSteve

Well-Known Member
0.75 as expected. Good news is they’re expecting our terminal rate to be less than many anticipate, bad news is that’s because the recession will do the job for them in relation to inflation

So another bit of related good news is they’re now expecting inflation to peak at around 11% not 13%+ . guessing reason is partly government energy assistance and also recession doing the job as mentioned above
 
shmmeee

shmmeee

Well-Known Member
CCFCSteve said:
0.75 as expected. Good news is they’re expecting our terminal rate to be less than many anticipate, bad news is that’s because the recession will do the job for them in relation to inflation

So another bit of related good news is they’re now expecting inflation to peak at around 11% not 13%+ . guessing reason is partly government energy assistance and also recession doing the job as mentioned above
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Yay?
 
W

wingy

Well-Known Member
CCFCSteve said:
0.75 as expected. Good news is they’re expecting our terminal rate to be less than many anticipate, bad news is that’s because the recession will do the job for them in relation to inflation

So another bit of related good news is they’re now expecting inflation to peak at around 11% not 13%+ . guessing reason is partly government energy assistance and also recession doing the job as mentioned above
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You often state about USA handouts Steve but our £400B handouts have played a part too.
The biggest issue to me the is USA more hawkish rate rises not being carried out in conjunction with international partner's.
I find that being more exploitative of the situation .
 
shmmeee

shmmeee

Well-Known Member
Not sure it was the handouts that’s caused inflation, it’s all supply side isn’t it? Fuel and manufacturing ramping up post covid.
 
Ian1779

Ian1779

Well-Known Member
CCFCSteve said:
0.75 as expected. Good news is they’re expecting our terminal rate to be less than many anticipate, bad news is that’s because the recession will do the job for them in relation to inflation

So another bit of related good news is they’re now expecting inflation to peak at around 11% not 13%+ . guessing reason is partly government energy assistance and also recession doing the job as mentioned above
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I’d hate to see what you thought bad news was…
 
shmmeee

shmmeee

Well-Known Member
wingy said:
And labour?
Lots of folk came out of it with a lot of surplus cash I think.
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Labour?

Yeah totally I’m sure they did, but it’s happening the same everywhere regardless of level of support from the govt isn’t it? Is there a correlation?
 
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CCFCSteve

Well-Known Member
wingy said:
You often state about USA handouts Steve but our £400B handouts have played a part too.
The biggest issue to me the is USA more hawkish rate rises not being carried out in conjunction with international partner's.
I find that being more exploitative of the situation .
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100% agree about furlough, excessive government borrowing etc mate. In hindsight it definitely caused problems but most would argue it was probably right call at the time. BOE also carried on QE too long and were late to raise rates (as we’re all central banks)

My point about US is they were handing out covid cheques to people on $100k+ per annum. I think I read at the time that if you were a couple with two kids and earned upto $130-140k you were give $11k for nothing 🤷‍♂️. All the QE boosted asset prices, supply side was squeezed globally and then in addition even recently US government has continued with known inflationary policies leading to the Fed having raise rates aggressively and every other central bank having to follow otherwise currencies will get smashed (even more ! - neither ECB nor BoE would be raising rates as quickly without Fed as we’ve got different problems)

All countries/governments have had their own part to play in inflation due to covid assistance but US has done far more than most and as global reserve currency it’s had a massive knock on effect worldwide

Edit - just to clarify I’m not saying we wouldn’t be having major issues anyway, it’s just US has made it worse/harder for a lot of central banks
 
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CCFCSteve

Well-Known Member
shmmeee said:
Not sure it was the handouts that’s caused inflation, it’s all supply side isn’t it? Fuel and manufacturing ramping up post covid.
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Some if it, especially at the start post covid and for us/Europe it’s majority energy, but US is far more demand led (and all the QE)
 
chiefdave

chiefdave

Well-Known Member
This part stood out to me, no doubt we'll hear a lot of 'its like this everywhere' over the coming months and years but the BoE seem to suggest that's not the case
It is a picture of a painful economic period, with the UK performing worse than the US and the Eurozone.
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CCFCSteve

Well-Known Member
chiefdave said:
This part stood out to me, no doubt we'll hear a lot of 'its like this everywhere' over the coming months and years but the BoE seem to suggest that's not the case
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It is but to different degrees and with impact at different times. It’s up to the government to come out and make it less painful…I’m not overly confident
 
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CCFCSteve

Well-Known Member
shmmeee said:
Brexit inflation as well id guess.
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Is that you Tony ?! 😊. There might be a small part but probably tiny in grand scheme of things

This was on a finance programme I saw the other day (im a dull man I know !) I think France and Spain are around 7-8% due to government assistance/suppression of energy costs. I’ve not fact checked but recognise the Holland and Germany numbers


7BCB91FB-1873-402B-ABA1-5362473348F5.jpeg
 
shmmeee

shmmeee

Well-Known Member
CCFCSteve said:
Is that you Tony ?! 😊. There might be a small part but probably tiny in grand scheme of things

This was on a finance programme I saw the other day (im a dull man I know !) I think France and Spain are around 7-8% due to government assistance/suppression of energy costs. I’ve not fact checked but recognise the Holland and Germany numbers


View attachment 27014
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Anecdotally the NL one sounds about right.
 
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