VAT rate and interest rates
Discussion
In the light of yesterday's (not unexpected) hike in VAT presumably this will have a significant impact on inflation come January - and as a result presumably interest rates will have to be hiked up around March next year by the MPC once this has filtered through?
I know there are a lot of factors at play and that for example reductions in public spending will be deflationary in effect, with a similar effect from reduced spending by consumers, combined with a low growth rate.
I am not an economics expert, none of us have a crystal ball etc, but am wondering what people who are perhaps closer to this than me think on balance?
I know there are a lot of factors at play and that for example reductions in public spending will be deflationary in effect, with a similar effect from reduced spending by consumers, combined with a low growth rate.
I am not an economics expert, none of us have a crystal ball etc, but am wondering what people who are perhaps closer to this than me think on balance?
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