Where do us savers go now then?

Lokolo

change in inflation was negative. That just means the economy is growing at a slower rate, it still means the economy is inflating at a big rate.

kengillam

Perhaps we should all wait until the car manufactirers are so desperate to shift metal we can pick up a Bugatti Veyron for a few grand, with oil prices low we might even be able to afford to run it

nilrem_2

wombat42 wrote: »

At least you are not losing money as you would do with shares. Zero percent interest is OK in a deflationary environment. Its if inflation picks up that you might have a problem.

It's not OK for people who rely on savings interest, they will have very little cash to spend no matter how low prices fall! People say well they must live off their capital but once that goes you have nowt to get interest on when rate do finally get better for savers.

nicko33

Lokolo wrote: »

change in inflation was negative. That just means the economy is growing at a slower rate, it still means the economy is inflating at a big rate.

No, the change in the Index was negative
218.4
217.7
216.0

The most recent months have all had a negative trend.
Deflation (from the Sep-2008 peak)

the headline 4.2% figure is the comparison with 12 months previous.
(although the change in that has also been negative, that could happen even if the Index increased, depending on what had happened 12 months ago, i.e. the index went up, but not by as much as it had 12 months ago)


according to RPI, we are IN a deflationary environment, looking at now, rather than the past.

Lokolo

Thats got to be wrong. If someone can confirm who is right out of me and Nick pleeease....

I have always understood inflation to change on a monthly basis depending on the consumer prices.

If consumer prices have lowered then inflation would be negative. However, inflation is currently at 4.1%, which means the economy is still inflating at a high rate, just because the change in inflation was negative, it doesn't mean that the economy is deflating. If the economy was deflating then surely inflation would go from 4% or whatever it was, straight to -2%?

nicko33

Have a look at
http://www.statistics.gov.uk/CCI/nugget.asp?ID=21

and from there
RPI Index (RP02)
RPI Percentage Change (RP04)

POPART_3

with this government, I'll tell you where we are going...... to Hell in a Hand Cart......pushed by Gordon Brown and Alistair Darling!!!!!!

Stompa

Lokolo wrote: »

Thats got to be wrong.

Nope, it's correct.

http://www.incomesdata.co.uk/statistics/statrpi.htm

http://www.incomesdata.co.uk/statistics/rpitable.htm

Lokolo

nicko33 wrote: »

Have a look at
http://www.statistics.gov.uk/CCI/nugget.asp?ID=21

and from there
RPI Index (RP02)
RPI Percentage Change (RP04)

I'm looking at CPI not RPI.... RPI compares EU whereas I don't care about them.

So...

What you are saying is when RPI reduces the prices reduce? If thats the case how do you go negative? [edit] is it if it goes below the Jan index??

nicko33

Lokolo wrote: »

I'm looking at CPI not RPI.... RPI compares EU whereas I don't care about them.

"The CPI is the main UK measure of inflation for macroeconomic purposes and forms the basis for the Government's inflation target. It is also used for international comparisons.

The RPI is the most familiar domestic measure of inflation in the UK"

http://www.statistics.gov.uk/statbase/Product.asp?vlnk=868&More=Y