This belief makes no sense at all. It is evidence of economic derangement, and little else. The reason for increasing interest rates when inflation rises is to suppress what is presumed to be heightened domestic demand arising from economic overheating, driven by excess private-sector activity that pushes demand beyond the economy’s capacity to supply what consumers wish to buy.
Nothing like that situation exists at present. Demand within our economy is already depressed. Consumer confidence is low. Business confidence is declining. Levels of the investment looked to be falling. Simultaneously, the government is looking at austerity once more with the intention of reducing support for those in need in the country.
All the signs are that we have a shortage of demand within the UK at present
So:
Key Inflation Details (March 2026)
Headline CPI Rate: 3.3%
Core CPI (excluding energy, food, alcohol, tobacco): 3.1%
Why’s inflation 50% over target if we have a shortage of demand?
Good news if true.
I’ll put a second bottle in the fridge.
Real austerity has never been tried…
Real austerity has never happened – at least not in the last 30 years. Osborne’s much vaunted ‘austerity’ resulted in government expenditure increasing every year, but it played well to their supporters for both sides to pretend it was happening.
Complete inversion of reality. Excess private sector activity increases supply.
Have you seen that HMG has been leaking a proposal for Rent Controls? The bastards really are intent on stealing people’s property rights.
Yup, been wondering if it’s communism (definitionally I mean)
My Council Tax is around 2% of the property value. Hypothetically moving out for a few years, depends how long the relatives last.. Renting is risky, might not get it back. So leave unoccupied and it gets 2nd home premium, so Council Tax is 4% of the prop value and the local Government collects your house off you in less than your lifetime because it’s not an approved use – nicking your house it is then albeit slowly – still property theft, so it’s communism.
It’s only communism if they line all the capitalists up against the wall and shoot them – otherwise it’s Socialism.
Rent controls, ending no fault evictions and it taking up to a year to get a tenant out who isn’t paying any rent.
It’s a pretty clear message: if you are a private landlord get out that business now.
I’ve been expecting nationalisation of at least part the housing stock for a good five years now. How else to explain the uniparty consensus in favour of screwing private landlords?
That is, yes, you can explain it in terms of crude electoral politics. But where does screwing private landlords take the bastards in Westminster?
The only answer to that that I could see was that they would ‘commandeer’ private landlord’s property in order to avert a (housing) crisis (which crisis was of course of the Westminster bastards own making).
I don’t care if there is some cunning plan. Offer me interest rates below inflation and my savings are going elsewhere.
I thought inflation was caused when the government printed money and pumped it into the economy, as they did during covid?????
That was on Monday
No, inflation is caused by international events like wars. Nothing to do with us.
There may be a shortage of demand: there’s no shortage of demands.
This is what you get when you buy 1/3 of a professor.
Let’s say we have a pub. Not a particularly successful one, just ticking over in a village with no passing trade. And then someone, let’s call them government, comes along and doubles the cost of hiring staff and increases the rateable value. You have to charge more. Your prices go up. Your turnover may not because the spending ability of the village has not changed. That’s inflationary. It has nothing to do with demand except for government never-ending demand for more. And you can’t fix it with interest rates. Is my uneducated economastery wrong?