Some Positive News

[life on mars]

Looks like there is light at the end of the tunnel , lets hope so its been a tough winter for many ..

The Consumer Prices Index fell to 10.7 per cent last month, down from 11.1 per cent in October. This follows predictions that October would be the month in which inflation peaked – so this morning’s figures from the Office for National Statistics will raise hopes that the worst may be behind us. This doesn’t appear to be a blip. The market expects this to continue for the next two years before bottoming out in 2025. There will be optimism, too, that we can look forward to a sharp fall in the CPI over the next few months as the surge in energy prices begins to drop out of the figures.

Global oil prices have fallen sharply, as have wholesale gas prices. It is also good news, from an inflation point of view, that the pound has started a sturdy recovery against the dollar – it is stronger against the currency than at any point since the middle of June. The dreaded moment when the pound reaches parity with the dollar has been put off yet again. A rising pound prevents us from importing inflation; indeed, it means that buying goods from abroad should be cheaper. However, the pound has not recovered so strongly against the euro – it is higher than its nadir in September, but still below summer levels. Given that we still import a lot of food from the EU we are unlikely to see large reductions in the price of basic commodities in the near future.

P.M.A .

[Cowbridge Blue]

It is good news indeed. Similar positive figures emerging in the U.S. are signals that we might actually have a 'soft landing' from measures take to curb inflation on both sides of the Atlantic. As LOM says, the strength of the pound affects coots of imports and the income value of exports and once a downward spiral begins it's very difficult to reverse the trend.

The strength of the pound is equally important to those of us who rely on regularly transferring cash from UK ie from perhaps pension payments and the like.

When I moved to U.S in 2011, I recall getting $1.54 for each pound and it remained steady for many years afterwards. However, in recent times eg when the Brexit debate / debacle was at its height, there was a steady decline in the strength of sterling against other currencies, in particular the euro and dollar. You will have noticed when planning and taking overseas holidays etc. Six months ago the pound was down to only $1.20 ish and when Liz Truss waved her magic wand that crashed to $1.03 overnight.

So, I for one am much relieved to see this modest recovery in the value of the pound and long may it continue. However, I don't see it ever getting back to the dizzy heights of 3 dollars for 2 pounds. Brexit and the lies used to encourage a 'leave' vote are taking their toll on UK and it will be a hard fight for British currency to return to anything like its former value. Likewise UK's standing as a major international influence, there's a huge fight on now for London to retain its position as the leading financial hub of Europe. Losing that would be a huge blow to UK and we will all be adversely affected forever.

Boris Johnson was more than just clown.