The Bank of England has cut interest rates – but with a warning: ‘Enjoy your summer but don’t go wild’? Who’s got the cash for that?
The Bank’s Monetary Policy Committee has brought interest rates down from 5.25 per cent to five per cent, after members finally acknowledged the fact that inflation has fallen back to its target level of two per cent.
Rates had been pushed up in order to restrict spending by people like you and me. If we’ve got higher amounts to pay on our mortgages or other long-term spending commitments, we’ve got less cash in our pockets for other products and that keeps inflation down.
Buy Cruel Britannia in print here. Buy the Cruel Britannia ebook here. Or just click on the image!
If we had more cash, the assumption is that we would spend it and this would make some commodities rarer, meaning retailers would charge more for them – and that would push up inflation.
As it is, inflation is expected to rise because of price increases in the service sector and the government’s new pay settlements. But these are both expected to settle down soon.
The BBC report ends with what This Writer sees as a surprisingly optimistic comment:
“Enjoy your summer, but don’t go wild” appears to be the message to Britain’s consumers.
Who’s got the cash to go wild?
For most of us – at best – this means we’ll have a tiny amount more money with which to pay for vital home improvements or supplies that we’ve had to delay. That’s all. I saw a TV report saying mortgage-payers will save something like £15 on each of their regular payments. Gosh. Be still, my beating heart.
The only people likely to be able to splash out wildly on luxuries are the super-rich who received so much cash from the Tories due to austerity and then Covid-19 – and I understand that markets catering for their rarefied tastes are the only consumer markets that have been doing well lately.
But they have been able to spend whatever they want – for years – anyway.
Still, it’s a step in the right direction, one supposes.
So, what are you going to do with the pennies the Bank of England has thrown at you?
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‘Enjoy your summer but don’t go wild’? Who’s got the cash for that?
The Bank of England has cut interest rates – but with a warning: ‘Enjoy your summer but don’t go wild’? Who’s got the cash for that?
The Bank’s Monetary Policy Committee has brought interest rates down from 5.25 per cent to five per cent, after members finally acknowledged the fact that inflation has fallen back to its target level of two per cent.
Rates had been pushed up in order to restrict spending by people like you and me. If we’ve got higher amounts to pay on our mortgages or other long-term spending commitments, we’ve got less cash in our pockets for other products and that keeps inflation down.
Buy Cruel Britannia in print here. Buy the Cruel Britannia ebook here. Or just click on the image!
If we had more cash, the assumption is that we would spend it and this would make some commodities rarer, meaning retailers would charge more for them – and that would push up inflation.
As it is, inflation is expected to rise because of price increases in the service sector and the government’s new pay settlements. But these are both expected to settle down soon.
The BBC report ends with what This Writer sees as a surprisingly optimistic comment:
Who’s got the cash to go wild?
For most of us – at best – this means we’ll have a tiny amount more money with which to pay for vital home improvements or supplies that we’ve had to delay. That’s all. I saw a TV report saying mortgage-payers will save something like £15 on each of their regular payments. Gosh. Be still, my beating heart.
The only people likely to be able to splash out wildly on luxuries are the super-rich who received so much cash from the Tories due to austerity and then Covid-19 – and I understand that markets catering for their rarefied tastes are the only consumer markets that have been doing well lately.
But they have been able to spend whatever they want – for years – anyway.
Still, it’s a step in the right direction, one supposes.
So, what are you going to do with the pennies the Bank of England has thrown at you?
Vox Political needs your help!
If you want to support this site
(but don’t want to give your money to advertisers)
you can make a one-off donation here:
Be among the first to know what’s going on! Here are the ways to manage it:
1) Register with us by clicking on ‘Subscribe’ (bottom right of the home page). You can then receive notifications of every new article that is posted here.
2) Follow VP on Twitter @VoxPolitical
3) Like the Facebook page at https://www.facebook.com/VoxPolitical/
Join the Vox Political Facebook page.
4) You could even make Vox Political your homepage at http://voxpoliticalonline.com
5) Join the uPopulus group at https://upopulus.com/groups/vox-political/
6) Join the MeWe page at https://mewe.com/p-front/voxpolitical
7) Feel free to comment!
And do share with your family and friends – so they don’t miss out!
If you have appreciated this article, don’t forget to share it using the buttons at the bottom of this page. Politics is about everybody – so let’s try to get everybody involved!
Buy Vox Political books so we can continue
fighting for the facts.
Cruel Britannia is available
in either print or eBook format here:
The Livingstone Presumption is available
in either print or eBook format here:
Health Warning: Government! is now available
in either print or eBook format here:
The first collection, Strong Words and Hard Times,
is still available in either print or eBook format here:
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