Leaders.com
  • Login
  • Subscribe
  • Business
  • Leadership
  • Wealth
  • Master Classes
  • Business
    • Entrepreneurs
    • Executives
    • Marketing and Sales
    • Social Media
    • Innovation
    • Women in Business
  • Leadership
    • Personal Growth
    • Company Culture
    • Public Speaking
    • Productivity
    • Hiring
    • Social Issues
    • Leaders
  • Wealth
    • Investing
    • Cryptocurrency
    • Retirement
    • Venture Capital
    • Loans and Borrowing
    • Taxes
    • Markets
    • Real Estate
  • Master Classes
  • Login
  • Subscribe
Business

The Bank of England see inflation getting even higher (photo by Mike Kemp/In Pictures via Getty Images)

By Tyler Hummel Leaders Staff

Tyler Hummel

Tyler Hummel

Tyler Hummel is a news writer for Leaders Media. He was the Fall 2021 College Fix Fellow and Health Care...

Full bio


Learn about our editorial policy

Sep 1, 2022

The U.K.’s Coming Inflation Crisis

Economists are warning that the ongoing energy crisis could send inflation skyrocketing in the U.K. 

Key details 
Goldman Sachs economists are warning that the United Kingdom could be facing 22.4% inflation rates in 2023. The estimate is tied to the increasing cost of energy in Europe, which has spiraled out of control in recent months.  

“In a scenario where gas prices remain elevated at current levels, we would expect the price cap to increase by over 80% in January… which would imply headline inflation peaking at 22.4%,” says Goldman Sachs economist Sven Jari Stehn. 

The U.K.’s inflation rate spiked to more than 9% in June following the war in Ukraine, but hasn’t decreased as the U.S. inflation rate has. 

America’s most recent recorded rate was 8.5% in July, while the U.K.’s was 10.1%. And it is expected to increase. 

A Wednesday CNBC report shows overall European inflation hitting 9.1% in August, an increase from 8.9% in July. 

Why it’s important
The inflation spike comes as British homes experienced a 145% price surge in gas prices, a coming 80% increase in energy bills, and an announcement by energy regulators that energy bill caps would increase on October 1. 

With no imminent end to the energy shortage, the U.K. economy is staring down a year of skyrocketing prices and economic pain. The Bank of England has already said a fourth-quarter recession is likely and that inflation projections have exceeded expectations. 

“U.K. peak inflation is likely to hit 14.8% in January, Goldman’s commodity strategists predicted—well above the 13.3% forecast by the Bank of England earlier this month,” says CNBC.

Backing up a bit
As we reported last week, Energy prices are spiking across Europe by over 1,000 Euro per megawatt in response to the continued effects of the Russian war in Ukraine. Volatile electricity prices are becoming worse due to the Russians threatening energy supplies. Prices have continued to skyrocket for the past seven weeks and are placing Europe in a dangerous position for the winter.

“Russia stopped gas flows through the Nord Stream 1 pipeline to the bloc on Wednesday with Gazprom starting three days of planned maintenance on the line. Russia has already been accused of weaponizing gas supplies to Europe and fueling a cost-of-living crisis in retaliation for Western sanctions due to its invasion of Ukraine,” says Yahoo Finance. 

Notable quote
“Prices in British shops rose at the highest rate since at least 2005 this month as Britons battled soaring costs on everything from gasoline to crisps. The British Retail Consortium said shop price inflation accelerated to 5.1% in August, a new record for the index which was started in 2005, and up from 4.4% in July. Food price increases hit 9.3% with milk, margarine and crisps seeing the biggest rises. This level of food inflation could continue for at least another six months,” says Bloomberg. 

Home / News / The U.K.’s Coming Inflation Crisis
Share
FacebookTweetEmailLinkedIn

Related Stories

Betting On A Super Bowl Jackpot 

by Tyler Hummel Leaders Staff
Entertainment

2 hours ago

This Sunday will mark a very successful day for sports betting companies as the Super Bowl attracts record revenues for U.S. sports gambling. 

Key Details

  • On Sunday, February 12, the NFL will host Super Bowl XLVII—between the Kansas City Chiefs and Philadelphia Eagles. 
  • Last year’s Super Bowl received more than 208 million viewers—with 70,000 fans attending SoFi Stadium in California. 
  • With such high viewership, sports gambling is expected to hit record highs this year, with as many as 50 million Americans betting $16 billion this Sunday. The American Gaming Association notes this is a 66% increase from last year. 
  • 36 U.S. states and DC permit legalized sports gambling, and the industry earned $7.5 billion in revenue last year, The Wall Street Journal reports. 

Go deeper

FacebookTweetEmailLinkedIn

Becoming the Employee Of Tomorrow

by Hannah Bryan Leaders Staff
Books

3 hours ago

Tomorrowmind

New technology and automation are changing how we work, but the forward-thinking employee can avoid having new technology leaving them behind by keeping this mindset.

Key Details

  • Tomorrowmind is a guide for the worker looking to “future-proof” his career in a time when automation, downsizing, and globalization threaten nearly every career path. 
  • World-renowned psychologist Martin Seligman and BetterUp CPO Gabriella Kellerman offer readers advice from their perspective as workplace mental health experts. 
  • Toxicity in the workplace, industry volatility, and constant turnover have threatened the peace of mind of many employees. Tomorrowmind gives workers the tools they need to thrive in a changing workplace. 

Go deeper

FacebookTweetEmailLinkedIn

BP Backs Away From Renewables

by Savannah Young Leaders Staff
Business

9 hours ago

“At the end of the day, we’re responding to what society wants,” says BP CEO Bernard Looney as the company shifts away from renewable energy to focus on gas and oil.

BP is slowing down on the switch to renewable energy as oil continues to be the main profit driver.

Key Details

  • BP said it's slowing down on renewable energy and focusing most of its spending on oil and gas production.
  • The company reported a record profit of $28 billion for 2022 as it capitalized on soaring energy costs leaning away from renewable energy.
  • “At the end of the day, we’re responding to what society wants,” says BP CEO Bernard Looney.

Go deeper

FacebookTweetEmailLinkedIn
Google
Tech

10 hours ago

Google Announces ChatGPT Rival 

by Tyler Hummel Leaders Staff
amazon prime
Entertainment

11 hours ago

Amazon Reaps Gains Of Media Investments

by Hannah Bryan Leaders Staff
Innovation

12 hours ago

The A.I. Battle Of the Giants

by Hannah Bryan Leaders Staff

Recent Articles

Wealth

14 hours ago

How to Pay Sole Proprietorship Taxes and Avoid IRS Penalties

Sole proprietorship taxes include income taxes and self-employment taxes.

Entrepreneurs

Feb 6, 2023

Here’s a Step by Step Guide on How to Start a Podcast

Eliminate confusion, create a podcast in 15 detailed steps

Wealth

Feb 3, 2023

The Most Landlord-Friendly States in 2023

Invest in landlord-friendly states to make more profits

  • Business
  • Leadership
  • Wealth
Join the Leaders Community

Get exclusive tools and resources you need to grow as a leader and scale a purpose-driven business.

Subscribing indicates your consent to our Terms & Conditions and Privacy Policy

Leaders.com
  • Privacy Policy
  • About
  • Careers
  • Cookie Policy
  • Terms
  • Disclosures
  • Editorial Policy
  • Member Login

© 2023 Leaders.com - All rights reserved.

Search Leaders.com