More threat to inflation

shortchanged_2

http://www.bbc.co.uk/news/business-19347503

One of the big six energy companies today announced inflation busting rises for gas and electricity. With the other 5 sheep mentality companies likely to follow this is yet another blow to household budgets, particularly with prices at the pumps on the march again and the recent announcement of a rise in grain prices likely to impact food prices.

Would you like to re-adjust your inflation estimates of "more than likely less than 2% for the second half of the year" now Mervyn?

wotsthat

Apathetic consumers are, in part, to blame for increases in inflation. Can't just blame everything on the companies trying to put up prices.

A fellow called Martin Lewis seems to offer some sound advice...

Martin Lewis, of the consumer website MoneySavingExpert.com, said many people could save money by switching to one of the fixed-rate deals currently on offer.

"Two major energy companies are currently offering cheap fix deals at the same price as the cheapest variable deals, cutting many people's bills by hundreds of pounds and guaranteeing no price rises for up to two winters," he said.

"More surprisingly, those tariffs do not involve exit penalty lock-ins, so you can leave whenever you want."

ILW

shortchanged wrote: »

http://www.bbc.co.uk/news/business-19347503

One of the big six energy companies today announced inflation busting rises for gas and electricity. With the other 5 sheep mentality companies likely to follow this is yet another blow to household budgets, particularly with prices at the pumps on the march again and the recent announcement of a rise in grain prices likely to impact food prices.

Would you like to re-adjust your inflation estimates of "more than likely less than 2% for the second half of the year" now Mervyn?

I think Mervyn has already admitted he doesn't have a clue what is going on.

I would like to get £300,000 + for not knowing what was happening.

shortchanged_2

wotsthat wrote: »

Apathetic consumers are, in part, to blame for increases in inflation. Can't just blame everything on the companies trying to put up prices.

A fellow called Martin Lewis seems to offer some sound advice...

Martin Lewis, of the consumer website MoneySavingExpert.com, said many people could save money by switching to one of the fixed-rate deals currently on offer.

"Two major energy companies are currently offering cheap fix deals at the same price as the cheapest variable deals, cutting many people's bills by hundreds of pounds and guaranteeing no price rises for up to two winters," he said.

"More surprisingly, those tariffs do not involve exit penalty lock-ins, so you can leave whenever you want."

Yes this maybe a point wotsthat but you'll probably find that the majority of the new rates offered by the utility companies will be rising by a similar amount so the overall trend in utility prices certainly remains upwards.

robmatic

shortchanged wrote: »

http://www.bbc.co.uk/news/business-19347503

One of the big six energy companies today announced inflation busting rises for gas and electricity. With the other 5 sheep mentality companies likely to follow this is yet another blow to household budgets, particularly with prices at the pumps on the march again and the recent announcement of a rise in grain prices likely to impact food prices.

Would you like to re-adjust your inflation estimates of "more than likely less than 2% for the second half of the year" now Mervyn?

Will this not depend on how much of the household budget is spent on energy or food? And whether energy useage is constant from year to year? In relation to the second point I would imagine that energy use declines as more energy efficient appliances, lightbulbs etc. hit the market.

Graham_Devon

shortchanged wrote: »

http://www.bbc.co.uk/news/business-19347503

One of the big six energy companies today announced inflation busting rises for gas and electricity. With the other 5 sheep mentality companies likely to follow this is yet another blow to household budgets, particularly with prices at the pumps on the march again and the recent announcement of a rise in grain prices likely to impact food prices.

Would you like to re-adjust your inflation estimates of "more than likely less than 2% for the second half of the year" now Mervyn?

Could see it all coming a mile off!

chewmylegoff

shortchanged wrote: »

http://www.bbc.co.uk/news/business-19347503

One of the big six energy companies today announced inflation busting rises for gas and electricity. With the other 5 sheep mentality companies likely to follow this is yet another blow to household budgets, particularly with prices at the pumps on the march again and the recent announcement of a rise in grain prices likely to impact food prices.

Would you like to re-adjust your inflation estimates of "more than likely less than 2% for the second half of the year" now Mervyn?

not that i'm a pedant or anything, but isn't this a threat of inflation, rather than a threat to inflation...

Graham_Devon

That bloke from the BOE never resigned either...

wotsthat

shortchanged wrote: »

Yes this maybe a point wotsthat but you'll probably find that the majority of the new rates offered by the utility companies will be rising by a similar amount so the overall trend in utility prices certainly remains upwards.

I've just come to the end of a great fix and the best replacement I could find was £50 more each year. However, thanks to this site, I managed to get £70 cashback for switching. Net I'll be paying at least £20 less for gas & electricity in 2013.

Please can you keep this to yourself because I've always thought that people who take a 9% increase in the cost of gas & electric without looking at alternatives are subsidising my deflating bills.

I've no doubt that the trend is upwards for most but check out the article (and my quote) if you're worried. It's possible to secure gas & electricity fixed for the next two winters AND there's no tie in so if prices by chance fall you can move. You'd be helping to keep inflation low too.

Loughton_Monkey

The last thing Energy Companies want is stable fuel prices.

If input costs were stable, then their retail prices would have to be reasonably stable. The volatility we have seen recently, as we all know, allows them to increase massively (and quickly) when input costs go up, and then decrease them slightly and slowly when they fall again.

Regulators are as useful as a chocolate teapot since they have no powers, and can do nothing against an oligopoly like this.

However, one's own inflation is very much down to the individual. We can do nothing about individual price rises, but what we can do is shop around, and budget properly. Only a week ago, I halved my Household Insurance by shopping around.

I've been retired for nearly 7 years, and I know that my income/financial resources are generally set in concrete. So I find it quite easy to 'fix' my expenses and set them in the same concrete. It isn't difficult. Each year, my budget is 3% higher than the previous year. If energy prices go up more than I budgeted, and I can't lower them, then I simply spend less on groceries, eating out, petrol, household goods etc. I have twelve individual months in which to measure, analyse, re-plan, re-budget by category, and ensure that I end the year spending not a single penny more than my budget.

In fact I usually spend less. So I have a substantial 'slush fiund' of surplus that will see me through if I ever get to the stage of being unable to control my 'own' inflation to within 3%.

Thrugelmir

shortchanged wrote: »

Would you like to re-adjust your inflation estimates of "more than likely less than 2% for the second half of the year" now Mervyn?

Though QE £375 billion has been pumped into the banking system. Since 2008 the M4 broad money measure has contracted by £545 billion. As the banks have contracted their balance sheets.

So that's £170 billion less of "cash" in circulation. Deflation must still be a major concern looking forward.