(VOR News) – Following last month’s drop in inflation to 1.7%, the Bank of England now has all the data needed to decide whether to reduce interest rates next month.

From 2.2% in August, the rate of price growth has sharply declined and is now much below the 2% objective set by the central bank. We have returned to the state we were in at the beginning of 2021, just before Russia invaded Ukraine and increased energy prices.

Low interest rates and inflation will soon boost Labour, which relieves Rachel Reeves.

This will help her finance the investments in this month’s budget by allowing her to borrow money without scaring the financial markets.

A decline in departmental spending may be predicted by the Office for Budget Responsibility (OBR) in conjunction with a decline in inflation. For example, the September inflation rate will decide the working-age benefit increase in April of the following year, saving billions on the welfare tab.

The OBR projects that the cost of servicing government debt will go down. It came to more than £100 billion in the fiscal year 2023–2024, or around 10% of all spending. This is because the Bank currently anticipates a quicker decline in borrowing costs.

In her budget for October 30, Reeves has the chance to raise long-term infrastructure expenditures while keeping actual spending on daily expenses same. This depends on the Treasury’s capacity to borrow money at a cheaper cost and the ability of Whitehall departments to set lower inflation-aware budgets.

This illustrates the significant influence that lowering inflation can have. Of course, the chancellor will still need to enact some big tax rises, but this might potentially be a part of a larger story that is far more positive about the UK than most analysts—including the Treasury—had previously thought.

A lot will depend on how the OBR evaluates the ensuing five years, as its March estimate cannot have altered significantly. It is therefore anticipated that significant revisions to the projected borrowing costs and inflation will be needed.

A forecast of borrowing costs needs to take the Bank of England’s response into consideration. Prior to the latest numbers being released, eighty percent of investors were certain that interest rates would be decreased by a quarter of a percentage point to 4.75% when policymakers met the following month.

Consequently, those odds have dropped to 90%, and as Bank governor Andrew Bailey told the Guardian earlier this month, there is an increasing possibility that rates may be further lowered in the coming year if inflation declines faster than expected.

The financial markets behaved as anticipated after the September inflation estimate was released. Because of sterling’s ongoing depreciation in currency markets.

The pound has fallen from $1.34 at the inflation end of last month to less than $1.30.

It is anticipated that a sizable portion of the nine members of the Bank’s monetary policy committee (MPC), which determines interest rates, will continue to harbor doubts regarding the likelihood of long-term price stability.

They will stress how the recent decline in inflation is a direct result of the recent decline in energy costs and their effects on sectors like transportation. According to data from the Office for National Statistics, the average cost of gasoline decreased by 5.5 pence per liter to 136.8p in September of 2024.

MPC members, who are frequently impacted by the falling cost of transportation, will be concerned about the continuous, notable increase in food expenses. The main measure of longer-term inflationary trends, the core inflation number, was revealed at a significantly higher rate of 3.2%. Food and energy are not included in this figure due to their considerable volatility.

However, sluggish wage growth indicates that borrowing costs need to be lowered as the economy is about to collapse. These days, Beijing’s economic policies have a greater influence on oil prices than wars in the Middle East.

Additionally, China, the biggest consumer of oil in the world, is currently going through a major slowdown as a result of the stunning collapse of the real estate bubble.

The US economy is expected to expand on the other side of the Atlantic. The situation in Ukraine and the waning demand from its primary export markets, China and the US, are adding to the already heavy load that the rest of Europe is already carrying.

Interest rates will probably decrease more quickly than first predicted since the MPC will evaluate changes in interest rates in light of the state of the world economy.

Reeves will voice his disapproval of the way the world economy is going. Her goal is to restore public finances while making up for more than a decade of improper public spending allocations during the Conservative administration.

SOURCE: TGN

SEE ALSO:

FEMA Workers Change Some Hurricane-Recovery Efforts In North Carolina After Receiving Threats

Lufthansa Was Issued a Record $4 Million Fine For Discriminating Against Jewish Passengers.

Salman Ahmad

Salman Ahmad is a seasoned freelance writer who contributes insightful articles to VORNews. With years of experience in journalism, he possesses a knack for crafting compelling narratives that resonate with readers. Salman's writing style strikes a balance between depth and accessibility, allowing him to tackle complex topics while maintaining clarity. His commitment to thorough research ensures his pieces are well-informed and thought-provoking. Salman's contributions enrich VORNews' content, offering readers a fresh perspective on current events and pressing issues.

See Full Bio

Public leaders from Scotland and the United Kingdom have paid tribute to former Scottish First Minister Alex Salmond, who died on Saturday at the age of 69.

Salmond, a key member of the Scottish independence movement, became unwell in North Macedonia on Saturday after delivering a speech, according to British media reports.

Salmond was presumed to have died of a heart attack, according to the British Press Association, but a post-mortem examination will be conducted to determine the cause.

Alex Salmond, Leading Figure In Scottish Independence Movement, Dies At Age 69

Tributes to Salmond, who was Scotland’s First Minister from 2007 to 2014 and led the Scottish National Party twice – from 1990 to 2000 and 2004 to 2014 – came from all sides of the political spectrum, led by King Charles.

“My wife and I are greatly saddened to hear of the sudden death of Alex Salmond,” the monarch told reporters. “His devotion to Scotland drove his decades of public service.”

British Prime Minister Keir Starmer stated, “For more than 30 years, Alex Salmond was a monumental presence in Scottish and UK politics. He leaves a lasting legacy. As First Minister of Scotland, he was strongly committed to Scotland’s tradition, history, and culture, as well as the communities he represented as MP (member of parliament) and MSP (member of the Scottish parliament) over many years. My sympathies are with all who knew him, including his family and loved ones. Today, on behalf of the UK government, I extend our sympathies.

Salmond had spent decades championing the cause of Scottish independence and came close to achieving it, receiving 45% of the vote when the matter was put to a referendum in September 2014.

Following the defeat, he resigned as first minister and SNP leader and was succeeded by Nicola Sturgeon, although he continued to work for Scottish independence through the newly established Alba Party, which he founded in 2021.

“I will never be able to thank Alex enough for all of his lessons, counsel, guidance, mentorship, love, and friendship, as well as everything he has done for Scotland. For many years, he was the nation’s father, and he has long been a father figure to me. Chris McEleny, General Secretary of the Alba Party, said on Saturday that his sympathies are with everyone in the family and everyone in Scotland who is mourning.

Scottish First Minister John Swinney said he was “deeply shocked and saddened by the untimely death” and sent his condolences to Salmond’s wife Moira and family.

“Over many years, Alex made an enormous contribution to political life – not just in Scotland, but throughout the UK and beyond,” Swinney stated.

“Alex worked tirelessly and battled valiantly for his beloved country and its independence. He brought the Scottish National Party from the edges of Scottish politics into government and led Scotland so close to independence,” he said.

After losing his seat in parliament, Salmond maintained a prominent role in Scottish and British politics, serving as a commentator and hosting the Alex Salmond Show on Russian state broadcaster RT.

Alex Salmond, Leading Figure In Scottish Independence Movement, Dies At Age 69

In 2018, he sued the country’s government over allegations of sexual misconduct leveled against him. Salmond said that the Scottish government denied him the opportunity to adequately defend himself against the allegations, which stemmed from his alleged behavior toward a member of staff at the official Bute House house, according to the Daily Record of Scotland.

A jury eventually cleared Salmond of all charges in a March 2020 trial.

“The terrible news of Alex Salmond’s death today will come as a shock to everybody who knew him in Scotland, the United Kingdom, and elsewhere. Our thoughts are with his family and friends during this sad time, and on behalf of Scottish Labour, I extend our heartfelt condolences to everyone who will be mourning his loss,” said Anas Sarwar, leader of the Scottish Labour Party.

“Alex was a central figure in politics for over three decades and his contribution to the Scottish political landscape cannot be overstated.”

SOURCE | CNN

Kiara Grace

Kiara Grace is a staff writer at VORNews, a reputable online publication. Her writing focuses on technology trends, particularly in the realm of consumer electronics and software. With a keen eye for detail and a knack for breaking down complex topics. Kiara delivers insightful analyses that resonate with tech enthusiasts and casual readers alike. Her articles strike a balance between in-depth coverage and accessibility, making them a go-to resource for anyone seeking to stay informed about the latest innovations shaping our digital world.

See Full Bio

(VOR News) – British Prime Minister Keir Starmer observed one hundred days of rule on Saturday with little to celebrate.

Starmer’s center-left Labour Party returned to power after 14 years in a landslide on July 4. Surveys show that Keir Starmer’s popularity has declined, and Labour is just marginally more popular than a Conservative Party that was rejected by voters after years of scandal and infighting, following weeks of feuding, freebies, and financial catastrophe.

“It’s hard to imagine a worse beginning,” said Queen Mary University of London political science professor Tim Bale.

“Your first impression of Keir Starmer matters.”

Keir Starmer won the election by promising to end years of turmoil and corruption under the Conservative regime, resuscitate the dying British economy, and fix public institutions like the NHS.

His administration claims to have made a good start by ending medical and railroad worker strikes, establishing a publicly traded green energy company, shelving the Conservative plan to send asylum seekers back to Rwanda, and protecting employee and tenant rights.

After years of Brexit debate, Keir Starmer has visited Washington, the UN, and major European capitals to show that “Britain is back”. However, the UK and its allies have struggled to impact the Middle East’s rising conflicts and Ukraine’s horrific war.

The new government had to deal with far-right-fueled anti-immigrant violence in England and Northern Ireland this summer. Keir Starmer called the rioters “mindless thugs” and pledged to arrest them. Out of over 800 court appearances, around 400 have been imprisoned.

The British economy, plagued by rising public debt and sluggish growth—0.2% in August, according to official statistics—is Starmer’s biggest challenge.

Before things improve, Keir Starmer warns they will be “tough in the short term.” He argues the Conservatives’ 22 billion pound ($29 billion) “black hole” in the public budget will curtail spending.

One of the government’s first measures was to eliminate a stipend to help millions of retirees stay warm in winter. Labour members and the public reacted strongly to it, even though it was designed to indicate that the administration was ready to make tough economic decisions.

Keir Starmer stole costly eyewear and apparel from a wealthy Labour donor.

Keir Starmer agreed to reimburse the guests for 6,000 pounds (nearly $8,000) in gifts and hospitality, including Taylor Swift tickets, despite her assurance that the presents were legal.

Advisors and government officials have blamed Downing Street Chief of Staff Sue Gray and her apparent conflicts with Labour campaign strategist Morgan McSweeney for the rocky start.

Gray resigned on Sunday after media attention revealed that she earned more than the prime minister. The information regarding her “had the potential to serve as a source of distraction.”

McSweeney succeeded her as Keir Starmer director of staff.

On the U.K. in a Changing Europe website, director Anand Menon said the administration made “avoidable mistakes” that propagated a “perception of incompetence and dysfunction.”

Treasury Chief Rachel Reeves’ first budget, due October 30, is now the government’s focus. The government hopes public and private investment will encourage economic growth, but billions are needed to complete the project. Reeves has refrained from hiking corporation, sales, or income taxes but has ruled out a “return to austerity”—a tricky balance. She may raise inheritance and capital gains taxes.

The administration hopes a strong economy and growing living standards will allow it to make tough decisions early and turn things around. Another election won’t be needed until 2029.

On his 100th day in office, Keir Starmer maintained his position at 10 Downing Street and refused to be “knocked off course.”

“There’s no avoiding these days and weeks when things are choppy,” he said. Governments work that way.

“It has significantly improved, but it’s also considerably more challenging than any prior experience.”

Bale believes the administration can regain trust by showing “not only that it has a plan to improve the country, but that it has a pretty dire inheritance.”

“In certain aspects, the vision has been deficient,” he stated. “I believe there is a lack of understanding among people regarding Keir Starmer or Labour.” Corrective action must be taken immediately.

SOURCE: CNBC

SEE ALSO

Trump Believes Biden Would Rather Him Than Harris At The Coachella Gathering.

Indian Media Labels Trudeau a Lair Over Claims He Held Talks With Prime Minister Modi

Salman Ahmad

Salman Ahmad is a seasoned freelance writer who contributes insightful articles to VORNews. With years of experience in journalism, he possesses a knack for crafting compelling narratives that resonate with readers. Salman's writing style strikes a balance between depth and accessibility, allowing him to tackle complex topics while maintaining clarity. His commitment to thorough research ensures his pieces are well-informed and thought-provoking. Salman's contributions enrich VORNews' content, offering readers a fresh perspective on current events and pressing issues.

See Full Bio