Definition of Household savings ratio: The percentage of disposable income that is saved. (1) Total savings = Disposable income – Household consumption UK Saving Ratio Latest UK household savings ratio: 2021 = 10% But, by 2021 Q4 the saving ratio had fallen to 6.2% By contrast, the average savings ratio in the past 54 years …
Summary Natural gas is a key raw material for heating and electricity generation, therefore higher prices will significantly increase the cost of living, increase inflation and could slow down economic growth. In the long term, higher gas prices will encourage consumers to find alternatives and firms to increase supply (e.g. fracking for natural gas), but …
Recessions (a fall in real GDP) are primarily caused by a fall in aggregate demand (AD). A demand-side shock could occur due to several factors, such as A financial crisis. If banks have a shortage of liquidity, they reduce lending and this reduces investment. A rise in interest rates – increases the cost of borrowing …
Russia is a medium sized economic with a GDP of $1.48 trillion (USD) about half the size of the UK $2.7 trillion (2020) The strengths of the economy is based on exports of oil and natural gas. And with these sales, since 2014, Russia has built up foreign currency reserves of $630bn – a large …
Economic sanctions are policies designed to hurt the economy of a target country. Sanctions can involve trade embargoes, seizure of assets, travel bans and limits on capital flows. The aim of sanctions is usually to provide a political signal of disapproval which stop short of military action. They can be imposed by one country unilaterally, …
Putting aside the very real human cost, war has also serious economic costs – damage to infrastructure, a decline in the working population, inflation, shortages, uncertainty, a rise in debt and disruption to normal economic activity. From some perspectives, war can appear to be beneficial in terms of creating demand, employment, innovation and profits for …
Biflation is a term used to describe a period where some prices are rising and some prices are falling. It can appear we have both inflation and deflation at the same time. CPI = Headline inflation rate CPI less food and energy = underlying or core inflation. In the above example, the headline rate is …
Since the financial crisis, we have seen an unprecedented stagnation/decline in real wages. This decline has been most noticeable for low-income workers, with growing levels of inequality. The decline/stagnation in real wages is a global phenomenon – though some countries have been more affected than others. Reasons suggested for falling/stagnant wages since 2008 include: Recession …