When it comes to inflation figures, trust your intuition

Article Abstract:

It is very likely that the new government which takes power in the UK following the forthcoming general election will be forced to increase interest rates. This is because it is gradually becoming clear that the economy is growing more rapidly than statistics indicate. The rise in house prices seems to have accelerated in the first few months of 1997, and research undertaken by Lehman Brothers indicates that the GDP figures may be misleading. The economy seems to be close to full capacity, and this means that a new government will have to tighten policy.

Author: McRae, Hamish
United Kingdom, Economic aspects, Economic development

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Washington provides the prelude to a year of rising interest rates

Article Abstract:

Financial markets are very keen to gain an indication of whether the Federal Reserve Board will decide to raise interest rates in the light of a tightening labour market and extremely highly valued shares. There a number of reasons why US interest rates may increase, including the upwards trend in monetary growth and the fact that interest rates will rise in other countries. Furthermore, the Federal Reserve may decide that it is necessary to take firm action against rising share prices in order to secure the stability of the financial system.

Author: McRae, Hamish

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Subjects list: Forecasts and trends, Column, Interest rates
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