Cost of Living crisis starts to bite

This week, the news has been dominated by the ongoing fallout from the tax and energy rises that have hit now we’re in a new financial year.

Starting from April 1st, National Insurance contributions were raised to their highest ever levels, domestic energy bill increases of 50%+ started to be implemented and a range of other cost increases including Council Tax rises went into effect. 

Combined with a trickling of news that casts the wife of the Chancellor as in effect a tax dodger, we’ve seen a week of real negativity directed towards HM Treasury.

This has played out interestingly in the currency markets. Against the Euro, the Pound has charted a relatively stable course, ending the week up from where it began. As discussed before, this is partially due to the War in Ukraine and the Euro being more exposed to the repercussions of that horrific situation. 

Against the Dollar though, we’ve seen a different picture, the Pound in the last hour or so briefly broke below the 1.30 mark for the first time in a very long time. Speculations are now that it could drop permanently below this mark pretty soon. Once again this is largely based on the UK’s proximity and exposure to the Ukrainian War in comparison to the US.

To close the week with something a bit more light-hearted, in Scunthorpe, a bottle has washed up on the beach containing a message from over 50 years ago written by two teenage girls who were looking for boyfriends. What makes it more fun is that they were reunited with their message and thankfully both found to be happily married!

Previous updates...

GDP falls for the second quarter in a row.

GDP falls for the second quarter in a row.

This week has been considerably quieter economic data front, perhaps a relief given the volume of negative news recently. US inflation figures were released on Wednesday with consumer prices rising 8.5% in July, the rate of increase has been calmed slightly as fuel prices fell. No increase was recorded in

BoE Governor: Expect 13%+ Inflation and a Recession!

BoE Governor: Expect 13%+ Inflation and a Recession!

The key update of the week is that the Bank of England has increased its interest rate by 0.5%, the largest increase since the Bank’s operational independence in 1997.  The rate rise comes on the back of a dismal economic forecast by the BoE that forecasted inflation rates of 13%

Fears of recession loom as inflation spirals and confidence declines

Fears of recession loom as inflation spirals and confidence declines

This week has been dominated by the fears of a looming recession following the release of key GDP and confidence data. Significant news was released on Thursday when it emerged that the US economy shrank for a second consecutive quarter. This technical recession is due to a 0.9% GDP contraction

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