Image for inflation woes how rising costs threaten

THREAD: inflation woes how rising costs threaten

LifeLine™ Media threads use our sophisticated algorithms to construct a thread around any topic you want, providing you with a detailed timeline, analysis, and related articles.

Chatter

What the world is saying!

. . .

News Timeline

Up arrow blue
HM Treasury - Wikipedia

LABOUR PARTY’S Economic Plan Under Fire: Will It Really Work?

— Britain’s new Treasury chief, Rachel Reeves, vows to run the economy with “iron discipline.” She hinted at above-inflation pay raises for public sector workers to end ongoing strikes.

The Labour Party, elected two weeks ago, faces pressure to increase salaries and welfare without raising taxes or public borrowing. Reeves criticized the previous Conservative government for high taxes and debt.

Labour won a landslide victory on promises of economic growth, housebuilding, green energy projects, and improved public services. The electorate seeks relief from high living costs and past economic mismanagement.

Inflation has dropped to 2%, but strikes by hospital doctors strain the National Health Service. Other public-sector workers like nurses and teachers have also demanded higher pay through walkouts over the past year.

GREEN AGENDA Hits Hard: Ofgem Warns of Financial Burden on Low-Income Consumers

GREEN AGENDA Hits Hard: Ofgem Warns of Financial Burden on Low-Income Consumers

— The Office of Gas and Electricity Markets (Ofgem) sounded an alarm on Monday. It cautioned that the shift towards a “Net Zero” carbon emissions economy could unfairly impact low-income consumers. These individuals might lack the financial resources to acquire government-approved technology or modify their lifestyle habits.

In the past year alone, debts from energy consumers have skyrocketed by 50%, amassing a total of £3 billion. Ofgem voiced grave concerns about struggling households’ limited resilience to future price shocks. The regulator also highlighted that the burden of recovering bad debts could pose serious threats to the retail energy sector.

Economic difficulties have already pushed British consumers into rationing their energy consumption. This has led to “harms associated with living in a cold, damp home,” potentially triggering an increase in mental health issues rates.

Tim Jarvis, Ofgem’s director general, underscored the necessity for a long-term strategy to manage escalating debt levels and shield struggling consumers from future price shocks. He mentioned that measures such as altering standing charges for prepayment meter customers and tightening requirements on suppliers had been implemented.

A Christmas rush to get passports to leave Zimbabwe is fed by ...

PASSPORT PANIC: Zimbabweans Race Against Time Amid Looming Price Hike Fear

— In Zimbabwe, currently grappling with economic woes, the most sought-after Christmas gift isn’t a gadget or toy, but a passport. The capital city’s passport office in Harare is teeming with citizens hoping to secure their travel documents before an expected price surge in the New Year. The looming increase and deteriorating economic conditions are driving a spike in migration.

Nolan Mukona, a 49-year-old father of three, was among those who rose at dawn to join the queue at the passport office. Despite his early start, he was greeted by over 100 people already waiting when he arrived at 5 a.m. “The only thing that can make my Christmas cheerful is if I manage to get a passport,” Mukona shared.

At present, passports cost $120 — an amount already burdensome for many Zimbabweans struggling to meet basic needs. However, according to 2024 budget proposals from the finance minister, these fees will rise to $150 in January — reduced from an initially proposed $200 after public backlash.

Over recent decades, millions of Zimbabweans have fled their homeland due to its crumbling economy. This exodus has accelerated recently as optimism for improvement following Robert Mugabe’s ousting from power in 2017 continues to wane.

UK INFLATION TUMBLES to 39%: Central Bank May Slash Rates Sooner Than Predicted

UK INFLATION TUMBLES to 39%: Central Bank May Slash Rates Sooner Than Predicted

— The Office for National Statistics (ONS) recently announced a surprising drop in UK inflation to 3.9% in November, a decrease from the previous month’s 4.6%. This dip, larger than what financial markets had forecasted, marks the lowest inflation level since September 2021.

This decline is primarily attributed to falling fuel and food prices according to the ONS. However, despite this optimistic news, the Bank of England’s primary interest rate remains at a staggering high of 5.25%, not seen for over a decade and a half.

Governor Andrew Bailey hinted that this stringent interest rate policy might continue for some time. Yet Samuel Tombs, chief U.K economist at Pantheon Macroeconomics suggests an alternative view — that this sharp fall in inflation could trigger an earlier-than-expected cut in interest rates; perhaps as early as the first half of next year.

While elevated interest rates initially helped curb inflation sparked by supply chain disruptions and Russia’s invasion of Ukraine, they have also put pressure on consumer spending and slowed economic growth. As such there are growing worries that maintaining high rates could inflict unnecessary damage on the economy.

UK inflation dips slightly to 10.1% | Business News | Sky News

UK Inflation DEFIES Predictions, STAYS at 67%: What’s Next for the Economy?

— The UK’s inflation rate held steady at 6.7% in September, flying in the face of economists’ predictions for a slight decrease. The Office for National Statistics highlighted that while food and drink prices dipped, they were counterbalanced by an uptick in fuel costs.

This persistent inflation rate is more than triple the Bank of England’s target of 2%. Despite this, it is not expected that the bank will hike interest rates during its November policy meeting. Instead, it seems set to keep its main borrowing rate at a peak not seen in 15 years — a hefty 5.25%.

James Smith from the Resolution Foundation think tank offered his perspective on this economic puzzle: “For now, progress on reducing inflation has hit a roadblock.” He anticipates a significant drop to below 5% next month as energy prices are projected to fall for most consumers.

In response to price surges triggered by pandemic-induced supply chain disruptions and Russia’s invasion of Ukraine — both factors contributing heavily to increased food and energy costs — the Bank of England has been steadily cranking up interest rates from near zero levels.

Down arrow red

Video

BIDEN’S LOW Approval Rating Fuels Reelection Fears

— During an interview, George Stephanopoulos challenged President Biden on his low 36 percent approval rating. “I’ve never seen a president with such a low rating get reelected,” Stephanopoulos remarked.

Biden dismissed the accuracy of the approval rating and expressed confidence in his efforts. “If Trump wins in November, I’ll feel as long as I gave it my all and did the best job I know I could do,” Biden stated.

The president emphasized that the United States is at a critical juncture, suggesting that decisions made now will shape the next several decades. His response has drawn ridicule online, with critics mocking his use of "the best job.

More Videos