Readers Question: If long term Interest rates in the US do not fall, how will this impact the US economy? Short Term Interest rates are governed by the Fed’s Current monetary Policy. These have fallen sharply in recent months from 4.25% to 2.25%. This reflects the Feds desire to avoid an economic downturn. The sharp …
A.Darling’s first budget is good news for those who don’t drink, smoke or buy SUVs. No major changes, but these are some of the main features of the budget. Cigarettes up 11p a packet of 20. Beer up by 4p a pint, wine 14p a bottle, spirits 55p a bottle. Duties on alcohol will go …
On March 12th, Alistair Darling will deliver his first budget. With the economy slowing down, he is not left with much room for manoeuvre. Tax Revenues are less than the government hoped and the National debt is likely to soon exceed the government’s self imposed ceiling of 40% of GDP. In 2008-09 Mr Darling will …
The pound reached the symbolic value of $2 = £1 yesterday. This is the highest level since New Year’s Eve and is partly in response to the Bank of England’s caution in cutting interest rates. (Yesterday, the Bank left rates unchanged at 5.25%) Despite the slowdown in the housing sector the Bank still appear worried …
Readers Question: i was wondering if u could give me some insight on how these macroeconomic factors will affect household consumption in 2008/2009. thanks Consumer Spending in the UK This graph shows the strong correlation between consumer spending and economic growth. Since 2005, consumer spending has continued to increase at an average of about 3% …
The government has announced that the National Minimum wage will rise to £5.73 for workers over 21 – by the end of 2008. This means for a worker on a 40 hour week, their take home pay will be £229 per week. This also attracts top up benefits from the government in the form of …
The argument was that the poll tax was so bad that anything had to be an improvement. So with little thought, the Conservative government brought out the Council Tax. The council tax aims to introduce a degree of proportionality and fairness by charging a tax equal to the value of a house. The argument is …
Readers Question: Interest rates are determined by the markets and not by the Bank of England-where’s the truth? An interesting question. Firstly, it is worth bearing in mind that there are different interest rates in an economy. Bank of England Base Rate. This is the most important interest rate because it is the rate at …